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The new Axis Starlight

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Joined: 23 Sep 2017
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The new Axis Starlight [#permalink]

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New post 06 Nov 2017, 04:05
The new Axis Starlight, Axis Suto's flagship electric-gas hybrid automobile, is considered so efficient by Axis that the company plans to sell Startlight to consumers for no payment other than the difference between what the consumer paid for gasoline for the past three years of driving their previous vehicle and what they will pay for gasoline while driving the Startlight for the next three years. Consumers will make an initial down payment, and then pay nay remaining fee after fuel costs have been assessed at the end of the three year period.
Which of the following, if true, would most significantly disadvantage Axis Auto based on their proposed payment system?
A. Most drivers own only one automobile
B. Other car manufacturers are planning to introduce similar fuel - efficient vehicles.
C. Drivers interested in the Starlight tend to drive significantly more miles annually than the average driver.
D. The price of gasoline is expected to rise dramatically over the next three years.
E. The annual amount spent on gasoline by drivers can be accurately determined based on the number of miles driven in a specific make of automobile.

Wonder between C & D and I am not convinced by the answer provided from the Powerscore as they explain below:
In D
Formula: Gallons of gas bought x Price/gallon = Total fuel cost
Three years previous to buying an Axis Starlight, an example:
3000 x1$ = 3000$
Three years after buying an Axis Starlight:
1000x 3$ = 3000$
=> Profit would be 0, makes sense
But How about C?
They drive more miles than....., price constant
For example,
before buying Starlight: a mileage of a car: 2miles/gallon, they drives 6000 miles => Gallons of gas bought: 2000
After buy Startlight: a better mileage of a car: 3 miles/gallon, they drive more ( as cited in answer choice) 9000 miles for example, => Gallon of gas bought: sill 2000
=> Profit of Axis Company is still 0 => Could be correct
Please clarity up! :)

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Re: The new Axis Starlight [#permalink]

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New post 06 Nov 2017, 09:07
Designated Target wrote:
The new Axis Starlight, Axis Suto's flagship electric-gas hybrid automobile, is considered so efficient by Axis that the company plans to sell Startlight to consumers for no payment other than the difference between what the consumer paid for gasoline for the past three years of driving their previous vehicle and what they will pay for gasoline while driving the Startlight for the next three years. Consumers will make an initial down payment, and then pay nay remaining fee after fuel costs have been assessed at the end of the three year period.
Which of the following, if true, would most significantly disadvantage Axis Auto based on their proposed payment system?
A. Most drivers own only one automobile
B. Other car manufacturers are planning to introduce similar fuel - efficient vehicles.
C. Drivers interested in the Starlight tend to drive significantly more miles annually than the average driver.
D. The price of gasoline is expected to rise dramatically over the next three years.
E. The annual amount spent on gasoline by drivers can be accurately determined based on the number of miles driven in a specific make of automobile.

Wonder between C & D and I am not convinced by the answer provided from the Powerscore as they explain below:
In D
Formula: Gallons of gas bought x Price/gallon = Total fuel cost
Three years previous to buying an Axis Starlight, an example:
3000 x1$ = 3000$
Three years after buying an Axis Starlight:
1000x 3$ = 3000$
=> Profit would be 0, makes sense
But How about C?
They drive more miles than....., price constant
For example,
before buying Starlight: a mileage of a car: 2miles/gallon, they drives 6000 miles => Gallons of gas bought: 2000
After buy Startlight: a better mileage of a car: 3 miles/gallon, they drive more ( as cited in answer choice) 9000 miles for example, => Gallon of gas bought: sill 2000
=> Profit of Axis Company is still 0 => Could be correct
Please clarity up! :)


hi....

Its not clear what the OA is. but as per me it should be D
If the prices of gasoline are going up, it will surely affect the profit as same amount of gasoline would cost more than what company is bargaining for..

now for C
Quote:
C. Drivers interested in the Starlight tend to drive significantly more miles annually than the average driver.


This driving MORE is always, even when they were using the previous vehicle or now.

I rather feel it strengthens the claim..

a normal person drives 5000 miles, efficiency 2 miles per gallon..... so he buys 5000/2=2500
now the efficiency has gone upto 3 miles per gallons ,......... so now he buys 5000/3 = 1666.67
he earns 2500-1667=833 gallons..

now someone who drives much more say 10000
the person drives 10000 miles, efficiency 2 miles per gallon..... so he buys 10000/2=5000
now the efficiency has gone upto 3 miles per gallons ,......... so now he buys 10000/3 = 3333.33
he earns 5000-3334=1666 gallons..

so he earns 1666 gallons rather than 833.. STRENGTHENS the claim

Hope it helps
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Absolute modulus :http://gmatclub.com/forum/absolute-modulus-a-better-understanding-210849.html#p1622372
Combination of similar and dissimilar things : http://gmatclub.com/forum/topic215915.html

Kudos [?]: 6151 [0], given: 121

Re: The new Axis Starlight   [#permalink] 06 Nov 2017, 09:07
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The new Axis Starlight

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