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# Source: MGMAT CR Adam will spend \$4,000 to rent a booth at

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Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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Updated on: 28 Aug 2017, 10:59
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Source: MGMAT CR
Adam will spend \$4,000 to rent a booth at the town’s annual county fair to promote his new Sandwich Shoppe. In previous years, the average food booth at the fair served 400 customers. Thus, in order to cover his costs, Adam has calculated that he must sell 400 sandwiches for \$10 each.

Which of the following statements casts the most doubt on Adam’s chances of breaking even at the county fair?

A. Adam should not limit himself to 400 sandwiches; he should be prepared to sell more.
B. Adam has not factored in the costs of raw materials or labor in calculating the amount of revenue he needs to generate to break even.
C. If booths in previous years averaged 400 customers, that means some booths served more than 400 and some served fewer than 400.
D. Many people prefer other types of food to sandwiches.
E. If Adam shares his booth, and the cost of the rental, with a complementary business, he will not have to sell as many sandwiches to break even.

Explanantion: Each sandwich costs some amount of money to make and sell, so even if Adam sells the 400 sandwiches as planned, his net income will certainly be less than \$4,000. Based on this statement, Adam definitely will not break even..

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Originally posted by arundas on 10 Oct 2010, 11:23.
Last edited by Skywalker18 on 28 Aug 2017, 10:59, edited 1 time in total.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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10 Oct 2010, 12:24
(A) if he could sell more than 400 sandwiches, it is likely that this would help him break even.

(B) CORRECT.

(C) this statement does not tell us that Adam will have fewer than 400 or that his plan cannot work.

(D) Out of scope..

(E) If he shares the cost of the booth rental, then he is more likely to sell
enough sandwiches to cover his costs.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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11 Oct 2010, 15:04
A: does not weaken
C: we don't know : >400 => strengthens / < 400 => weakens
D: does not deal with the subject
E: does not weaken

=> B (raw materials + labor increase global costs while they were not taken into account by Adam)
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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12 Oct 2010, 02:34
Why do'nt you agree with the OA ? .... your reasons are highly anticipated. In the meanwhile I think the Official Explanation says it all and this is an Easy B
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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12 Oct 2010, 05:07
Well i don't see any references for the initial costs, in the paragraph. We just know that the average costumer last time was 400, so i think our reasons should be built around facts provided. Well since B is the official answer then there is nothing we can do about it.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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12 Oct 2010, 06:10
prab wrote:
Well i don't see any references for the initial costs, in the paragraph. We just know that the average costumer last time was 400, so i think our reasons should be built around facts provided. Well since B is the official answer then there is nothing we can do about it.

That's exactly the point. Adam's reasoning is that he's paying \$4,000 and will sell around 400 sandwiches, so if he sells them for \$10 each, he'll recoup his \$4,000. But he didn't factor in the costs of making the sandwiches. When you include these costs, the total amount he needs to recoup is going to go above \$4,000.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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12 Oct 2010, 06:21
just B obviously weakens the argument
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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12 Oct 2010, 06:23
clearly B - if his cost turns out to be 1000 and he sells exactly 400 for 10* = 4000
therefore, 4000-1000 = 3000. he is under a loss.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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11 Dec 2010, 19:26
1
The wording of the question is what lets us make a clear choice here (B)--you're absolutely correct prab in pointing out that we don't have any information given about the initial costs. But the question asks for which choice "casts the most doubt" -- not disproves Adam's claim.

B in no way disproves Adam's claim about what he needs to sell to break even. But it directly addresses an assumption that underlies the argument as it is given. The other choices are "less good"for the reasons listed by the posters above-- that doesn't mean B is good; it just means B is the best of the flawed bunch.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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25 Jan 2011, 16:27
Conclusion: "in order to cover his cost"

Cost includes the rent for the booth AND the materials/labors to make the sandwiches.

Lets suppose he sold 400 sandwiches to earn \$4000, which will only cover the cost of renting the booth but not the cost of the materials/labors. Thus, B is correct.

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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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25 Jan 2011, 19:38
Clearly B as costs to make the sandwich need to be taken into consideration too.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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01 Sep 2013, 10:54
Adam concludes that to cover the \$4,000 cost of a booth at the fair, he will need
to sell 400 sandwiches at \$10 each. He relies on information about the number of
customers served by the average booth in previous years. The question asks
what most weakens Adam’s conclusion. The correct answer will either show that
Adam has overlooked other important costs, or that his logic is fundamentally
flawed. There could be more than one choice that seems to suggest that Adam
might not break even; the correct answer will be the one that eliminates any
possibility that he will break even.
(A) Though this is certainly true in a practical sense, it does not show that Adam's
plan will not work and that he will not stay within his budget. In fact, if he could
sell more than 400 sandwiches, it is likely that this would help him break even.
(B) CORRECT. Each sandwich costs some amount of money to make and sell,
so even if Adam sells the 400 sandwiches as planned, his net income will
certainly be less than \$4,000. Based on this statement, Adam definitely will not
break even.
(C) Though it is true that an average number of customers means some booths
served more and some served fewer, this statement does not tell us that Adam
will have fewer than 400 or that his plan cannot work. Consider also that each
customer might buy more than one sandwich, so Adam could have fewer
customers but still sell enough sandwiches to cover his costs.
(D) Although some people will buy other types of food at the fair, this statement
average number of customers for food booths in previous years, but those
booths may have sold sandwiches or other foods – we simply don’t have enough
information to judge whether this statement strengthens or weakens Adam’s
conclusion.
(E) Sharing the booth would actually make it more likely that Adam would break
even. If he shares the cost of the booth rental, then he is more likely to sell
enough sandwiches to cover his costs.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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02 Oct 2013, 07:40
arundas wrote:
Source: MGMAT CR
Adam will spend \$4,000 to rent a booth at the town’s annual county fair to promote his new Sandwich Shoppe. In previous years, the average food booth at the fair served 400 customers. Thus, in order to cover his costs, Adam has calculated that he must sell 400 sandwiches for \$10 each.

Which of the following statements casts the most doubt on Adam’s chances of breaking even at the county fair?

Adam should not limit himself to 400 sandwiches; he should be prepared to sell more.
Adam has not factored in the costs of raw materials or labor in calculating the amount of revenue he needs to generate to break even.
If booths in previous years averaged 400 customers, that means some booths served more than 400 and some served fewer than 400.
Many people prefer other types of food to sandwiches.
If Adam shares his booth, and the cost of the rental, with a complementary business, he will not have to sell as many sandwiches to break even.

Explanantion: Each sandwich costs some amount of money to make and sell, so even if Adam sells the 400 sandwiches as planned, his net income will certainly be less than \$4,000. Based on this statement, Adam definitely will not break even..

And yet another awful formulated question.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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08 Oct 2013, 04:26
B in no way is a straightforward choice. Who are we to assume that Adam did not take into account the miscellaneous costs while setting up the required selling price to be able to break even. No body would decide a S.P which will Any business on earth would know the math. B is definitely not a straightforward choice.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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22 Sep 2014, 07:22
Pretty much agree with the explanation given for Option B, but do not understand why is Option C ruled out. This Selling Price, which ADAM has decided is based on his poor understanding of the concept of average. He came to the number 400 because he feels he ll be able to garner 400 customers as that is the average and thus chose a price of 10 USD for each sandwich. But what if he is able to garner only 300 customers, or even less? He will be not be able to cover his costs then. Answer choice C exposes this gap of his understanding. Doesn't it weaken (not destry, just casts a doubt) the conclusion?
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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15 Nov 2016, 10:11
I agree with nitin 6305..I actually thought of the weakener on the exact same lines and so was not sure why C is wrong and B is correct.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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27 Aug 2017, 19:46
nitin6305 wrote:
Pretty much agree with the explanation given for Option B, but do not understand why is Option C ruled out. This Selling Price, which ADAM has decided is based on his poor understanding of the concept of average. He came to the number 400 because he feels he ll be able to garner 400 customers as that is the average and thus chose a price of 10 USD for each sandwich. But what if he is able to garner only 300 customers, or even less? He will be not be able to cover his costs then. Answer choice C exposes this gap of his understanding. Doesn't it weaken (not destry, just casts a doubt) the conclusion?

Exactly my thoughts.

Does Weaken correct answer needs to just "weaken" -- which is a lower bar -- or it needs to destroy (without doubt) the argument? i thought that in weaken questions, only one of the options would be weakening the argument but here both B or C can potentially weaken.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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28 Aug 2017, 11:07
Adam will spend \$4,000 to rent a booth at the town’s annual county fair to promote his new Sandwich Shoppe. In previous years, the average food booth at the fair served 400 customers. Thus, in order to cover his costs, Adam has calculated that he must sell 400 sandwiches for \$10 each.

Which of the following statements casts the most doubt on Adam’s chances of breaking even at the county fair?

A. Adam should not limit himself to 400 sandwiches; he should be prepared to sell more. - Irrelevant
B. Adam has not factored in the costs of raw materials or labor in calculating the amount of revenue he needs to generate to break even. - Correct - Adam only factors in rental cost but does not considers any other cost
C. If booths in previous years averaged 400 customers, that means some booths served more than 400 and some served fewer than 400. - Irrelevant
D. Many people prefer other types of food to sandwiches. - Irrelevant
E. If Adam shares his booth, and the cost of the rental, with a complementary business, he will not have to sell as many sandwiches to break even. Irrelevant -

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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at  [#permalink]

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31 Aug 2017, 20:08
BREAK EVEN means recovering the amount spent.
This includes: raw materials+labor+electricity+rent etc
Adam has taken into account only the rent, but he should factor in the other factors as well.
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Re: Source: MGMAT CR Adam will spend \$4,000 to rent a booth at &nbs [#permalink] 31 Aug 2017, 20:08
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