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The Kapoor Meatworks has a virtual monopoly on expensive, gourmet deli

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The Kapoor Meatworks has a virtual monopoly on expensive, gourmet deli  [#permalink]

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New post 26 Jul 2018, 17:41
4
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A
B
C
D
E

Difficulty:

  65% (hard)

Question Stats:

56% (01:43) correct 44% (01:35) wrong based on 188 sessions

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The Kapoor Meatworks has a virtual monopoly on expensive, gourmet delicacies. In order to expand their market, they intend to offer a budget line of less costly delicacies. Such a product is virtually unknown, and they realize that its success depends upon a heavy advertising campaign. They have decided to finance the advertising with the profits from their gourmet line.

Which of the following, assuming that each is a realistic possibility, would constitute the most serious obstacle to the Kapoor Meatworks' project?


A) The introduction of a budget line of delicacies completely undercuts the sales of the gourmet line.
B) At the start, the company spends more on advertising than it makes from sales of the budget line delicacies.
C) When the budget line delicacies grow in popularity, competitors enter the budget delicacies market and Kapoor does not have a monopoly in that market.
D) Many of the consumers who purchase the budget line are tempted to try the delicacies offered in the gourmet line.
E) Many of the stores that now carry Kapoor's gourmet line of delicacies are exclusive, and refuse to carry their budget line.

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Re: The Kapoor Meatworks has a virtual monopoly on expensive, gourmet deli  [#permalink]

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New post 26 Jul 2018, 18:24
Carlgrc wrote:
The Kapoor Meatworks has a virtual monopoly on expensive, gourmet delicacies. In order to expand their market, they intend to offer a budget line of less costly delicacies. Such a product is virtually unknown, and they realize that its success depends upon a heavy advertising campaign. They have decided to finance the advertising with the profits from their gourmet line.

Which of the following, assuming that each is a realistic possibility, would constitute the most serious obstacle to the Kapoor Meatworks' project?


A) The introduction of a budget line of delicacies completely undercuts the sales of the gourmet line.
B) At the start, the company spends more on advertising than it makes from sales of the budget line delicacies.
C) When the budget line delicacies grow in popularity, competitors enter the budget delicacies market and Kapoor does not have a monopoly in that market.
D) Many of the consumers who purchase the budget line are tempted to try the delicacies offered in the gourmet line.
E) Many of the stores that now carry Kapoor's gourmet line of delicacies are exclusive, and refuse to carry their budget line.


Profit from gourmet line for advertising for budget line ...
All choices may be tempting but look for most serious obstacle for above

Choice A gives us a reason that the money may not be available for advertising, thereby effecting the project.
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1) Absolute modulus : http://gmatclub.com/forum/absolute-modulus-a-better-understanding-210849.html#p1622372
2)Combination of similar and dissimilar things : http://gmatclub.com/forum/topic215915.html
3) effects of arithmetic operations : https://gmatclub.com/forum/effects-of-arithmetic-operations-on-fractions-269413.html


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Re: The Kapoor Meatworks has a virtual monopoly on expensive, gourmet deli  [#permalink]

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New post 27 Jul 2018, 22:04
chetan2u wrote:
Carlgrc wrote:
The Kapoor Meatworks has a virtual monopoly on expensive, gourmet delicacies. In order to expand their market, they intend to offer a budget line of less costly delicacies. Such a product is virtually unknown, and they realize that its success depends upon a heavy advertising campaign. They have decided to finance the advertising with the profits from their gourmet line.

Which of the following, assuming that each is a realistic possibility, would constitute the most serious obstacle to the Kapoor Meatworks' project?


A) The introduction of a budget line of delicacies completely undercuts the sales of the gourmet line.
B) At the start, the company spends more on advertising than it makes from sales of the budget line delicacies.
C) When the budget line delicacies grow in popularity, competitors enter the budget delicacies market and Kapoor does not have a monopoly in that market.
D) Many of the consumers who purchase the budget line are tempted to try the delicacies offered in the gourmet line.
E) Many of the stores that now carry Kapoor's gourmet line of delicacies are exclusive, and refuse to carry their budget line.


Profit from gourmet line for advertising for budget line ...
All choices may be tempting but look for most serious obstacle for above

Choice A gives us a reason that the money may not be available for advertising, thereby effecting the project.


Hi chetan2u

Can you please point whats wrong with choice E.
I felt that it seriously weakens the Argument as Kapoor's are ready for heavy advertising but there's no point in spending that much money as many stores refuse to carry the new budget line of less costly delicacies.

Is it because of the keyword Many.Meaning few stores may carry the new budget line.
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Re: The Kapoor Meatworks has a virtual monopoly on expensive, gourmet deli  [#permalink]

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New post 27 Jul 2018, 22:48
1
gmat1393 wrote:
chetan2u wrote:
Carlgrc wrote:
The Kapoor Meatworks has a virtual monopoly on expensive, gourmet delicacies. In order to expand their market, they intend to offer a budget line of less costly delicacies. Such a product is virtually unknown, and they realize that its success depends upon a heavy advertising campaign. They have decided to finance the advertising with the profits from their gourmet line.

Which of the following, assuming that each is a realistic possibility, would constitute the most serious obstacle to the Kapoor Meatworks' project?


A) The introduction of a budget line of delicacies completely undercuts the sales of the gourmet line.
B) At the start, the company spends more on advertising than it makes from sales of the budget line delicacies.
C) When the budget line delicacies grow in popularity, competitors enter the budget delicacies market and Kapoor does not have a monopoly in that market.
D) Many of the consumers who purchase the budget line are tempted to try the delicacies offered in the gourmet line.
E) Many of the stores that now carry Kapoor's gourmet line of delicacies are exclusive, and refuse to carry their budget line.


Profit from gourmet line for advertising for budget line ...
All choices may be tempting but look for most serious obstacle for above

Choice A gives us a reason that the money may not be available for advertising, thereby effecting the project.


Hi chetan2u

Can you please point whats wrong with choice E.
I felt that it seriously weakens the Argument as Kapoor's are ready for heavy advertising but there's no point in spending that much money as many stores refuse to carry the new budget line of less costly delicacies.

Is it because of the keyword Many.Meaning few stores may carry the new budget line.


Hi..

the main point of project is that the financing advertisement will be from profit of gourmet lines

the stores are not being questioned. if these stores refuse, other stores on rent/new may be picked up.

but point A puts a question mark on the profit itself, so a better choice
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1) Absolute modulus : http://gmatclub.com/forum/absolute-modulus-a-better-understanding-210849.html#p1622372
2)Combination of similar and dissimilar things : http://gmatclub.com/forum/topic215915.html
3) effects of arithmetic operations : https://gmatclub.com/forum/effects-of-arithmetic-operations-on-fractions-269413.html


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Re: The Kapoor Meatworks has a virtual monopoly on expensive, gourmet deli  [#permalink]

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New post 27 Jul 2018, 23:08
Quote:
Can you please point whats wrong with choice E.
I felt that it seriously weakens the Argument as Kapoor's are ready for heavy advertising but there's no point in spending that much money as many stores refuse to carry the new budget line of less costly delicacies.

Is it because of the keyword Many.Meaning few stores may carry the new budget line.

Hi..

the main point of project is that the financing advertisement will be from profit of gourmet lines

the stores are not being questioned. if these stores refuse, other stores on rent/new may be picked up.

but point A puts a question mark on the profit itself, so a better choice


Thank you @chetan2u.This makes sense.
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Re: The Kapoor Meatworks has a virtual monopoly on expensive, gourmet deli  [#permalink]

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New post 09 Aug 2018, 18:43
Hello chetan2u,

I went for C and my thought process was that when it loses the market for new budget line, there will be huge loss. There is no point in investing on advertising.

Where I went wrong?
Re: The Kapoor Meatworks has a virtual monopoly on expensive, gourmet deli &nbs [#permalink] 09 Aug 2018, 18:43
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