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# Surveys show that every year only 10 percent of cigarette

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Manager
Joined: 06 Jun 2005
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Surveys show that every year only 10 percent of cigarette [#permalink]

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11 Jul 2005, 05:48
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Surveys show that every year only 10 percent of cigarette smokers switch brands. Yet the manufacturers have been spending an amount equal to 10 percent of their gross receipts on cigarette promotion in magazines. It follows from these figures that inducing cigarette smokers to switch brands did not pay, and that cigarette companies would have been no worse off economically if they had dropped their advertising.
19. Of the following, the best criticism of the conclusion that inducing cigarette smokers to switch brands did not pay is that the conclusion is based on
(A) computing advertising costs as a percentage of gross receipts, not of overall costs
(B) past patterns of smoking and may not carry over to the future
(C) the assumption that each smoker is loyal to a single brand of cigarettes at any one time
(D) the assumption that each manufacturer produces only one brand of cigarettes
(E) figures for the cigarette industry as a whole and may not hold for a particular company

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Senior Manager
Joined: 17 Apr 2005
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11 Jul 2005, 07:45
Picked C.
Because if smokers smoke more than one brand, ads can make them smoke more of one brand than the other(without actually swiching), and thereby increase sales.

HMTG.

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Senior Manager
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11 Jul 2005, 11:46
HMTG, That is exactly the same reason I picked C. If a person smokes several brands, then it is possible for one to stop smoking one brand and smoke more of another, without switching the brands.

The Answer has to be C

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Director
Joined: 18 Feb 2005
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11 Jul 2005, 14:58
Looks D to me...

The smoker might be switdhing brands but manufactured by the same org.

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Director
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11 Jul 2005, 16:10
I am also with (C).

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SVP
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11 Jul 2005, 17:39
i prefer E.

the conclusion is based on the figure for the whole cigarette industry not for a particular company. the conclusion is also assumed that the figure is symmetrically distributed to all companies in the industry. but if some companies are having 15% growth, then they are worthful in spending the advertising spending. so why should they stop advertising?

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Manager
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11 Jul 2005, 23:33
D

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SVP
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12 Jul 2005, 19:40
Any OA????????

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Manager
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13 Jul 2005, 03:33
I would say D
"Yet the manufacturers have been spending an amount equal to 10 percent of their gross receipts on cigarette promotion in magazines."

Manufacturers can produce more than one brand of cigarettes. If it is the cases. then the conclusion is faulty.

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Manager
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13 Jul 2005, 03:41
There is no offical key to this question but personally I lean to key E because key D is actually strenghening the criticism

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13 Jul 2005, 03:41
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# Surveys show that every year only 10 percent of cigarette

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