Since Thealls, a retail store located in Beach Haven,

Question

Since Theall’s, a retail store located in Beach Haven, had a strong year two years ago, management decided last year that the store could afford to advertise more during the summer last year than it had in previous summers. Then, last year, Theall’s sales in the summer were stronger than in any previous summer.

Determining which of the following would be most helpful in determining whether the increase in sales can be attributed to the increase in advertising spending?

Determining which of the following would be most helpful in determining whether the increase in sales can be attributed to the increase in advertising spending?

(A) Whether by improving customer service Theall’s could have increased sales without spending more on advertising

(B) Whether the increase in Theall’s profits attributable to the increase in sales was greater than the increase in advertising spending

(C) What proportion of the increase in sales can be attributed to repeat customers spending more at Theall’s last summer than they spent the previous summer

(D) How sales of other retail stores in Beach Haven last summer compared with their sales the previous summer

(E) Whether Theall’s sales for last summer were stronger than its sales for any other season last year

Source:  Marty Murray Coaching

ManifestDreamMBA · Answer

(A) Whether by improving customer service Theall’s could have increased sales without spending more on advertising
 We need to evaluate if advertising lead to increased sales. This what-if scenario doesn't help

(B) Whether the increase in Theall’s profits attributable to the increase in sales was greater than the increase in advertising spending
 We are not concerned about profits, just increased sales and if the same is a result of advertising

(C) What proportion of the increase in sales can be attributed to repeat customers spending more at Theall’s last summer than they spent the previous summer
 Repeat customers usually don't confirm advertising effects - advertising is usually done to acquire new customers. Even if repeat customers are purchasing more, we can't say it is because of advertising. What if more supplies were needed because of some reason in Beach Haven 
 
 (D) How sales of other retail stores in Beach Haven last summer compared with their sales the previous summer
 All things considered the same, if Theall's is doing better than the other retail stores, it could be attributed to the advertising.

(E) Whether Theall’s sales for last summer were stronger than its sales for any other season last year
 Wouldn't help justify. What if population is growing and hence sales grew regardless of advertising?

pk14y · Answer

The reason I ruled out C was because of the difference in "spending more" compared to "sales". Spending more does not necessarily mean more sales, they could have just ordered more expensive items on the menu.

When I first read D I was skeptical, but after ruling out the other answer choices I came to this one due to the fact that advertisement will draw customers away from other stores and could contribute to lesser market share.

MartyMurray · Answer

Since Theall’s, a retail store located in Beach Haven, had a strong year two years ago, management decided last year that the store could afford to advertise more during the summer last year than it had in previous summers. Then, last year, Theall’s sales in the summer were stronger than in any previous summer.

Determining which of the following would be most helpful in determining whether the increase in sales can be attributed to the increase in advertising spending?

Determining which of the following would be most helpful in determining whether the increase in sales can be attributed to the increase in advertising spending?

In this question, the conclusion is not stated in the passage. Rather, the conclusion is presented in question stem. So, to answer this question, we have to evaluate the case for the following conclusion:

the increase in sales can be attributed to the increase in advertising spending

The passage presents some support for the conclusion, which is the following:

management decided last year that the store could afford to advertise more during the summer last year than it had in previous summers. Then, last year, Theall’s sales in the summer were stronger than in any previous summer.

We see that the passage indicates that there was a correlation between an increase in advertising spending and an increase in sales. So, that correlation could be taken as indicating that the increase in sales can be attributed to the increase in advertising spending.

The correct answer will be the one such that determining what it mentions will weaken or strengthen the case for the conclusion.

(A) Whether by improving customer service Theall’s could have increased sales without spending more on advertising

Determining this would not help with evaluating the case for the conclusion.

After all, information on whether Theall's COULD HAVE increased sales by improving customer service does not indicate whether the increase in advertising spending DID cause an increase in sales.

Eliminate.

(B) Whether the increase in Theall’s profits attributable to the increase in sales was greater than the increase in advertising spending

Determining this would not help with evaluating the case for the conclusion.

After all, regardless of whether the increase in profits was greater than the increase in advertising spending, the increase in advertising spending could have caused the increase in sales.

If we were seeking to determine whether the increase in advertising spending paid off, this choice would be relevant, but that's not what we're seeking to determine.

Eliminate.

(C) What proportion of the increase in sales can be attributed to repeat customers spending more at Theall’s last summer than they spent the previous summer

Not only new customers but also repeat customers can be influenced by advertising.

So, regardless of what proportion of the increase in sales can be attributed to repeat customers spending more, the increase in advertising spending may or may not have been the cause of the increase in sales.

Eliminate.

(D) How sales of other retail stores in Beach Haven last summer compared with their sales the previous summer

This choice is interesting.

After all, if sales of other stores in Beach Haven also increased, then it could be that the increase in Theall's sales can be attributed to some general factors that affected all stores in Beach Haven rather than the increase in advertising.

On the other hand, if sales of other stores did not increase, then we can be more confident that the reason for the increase in Theall's sales was the increase in advertising.

So, determining what this choice mentions would help with determining whether the increase in sales can be attributed to the increase in advertising spending.

Keep.

(E) Whether Theall’s sales for last summer were stronger than its sales for any other season last year

This choice introduces an irrelevant comparison.

After all, what we're seeking to determine is whether the increase in advertising spending from the previous summer to the past summer was the cause of the increase in sales from the previous summer to the past summer.

We don't know anything about how advertising spending in the summer compares with that in other seasons. For instance, for all we know, Theall's increased advertising spending for all of last year.

Also, we have no idea how sales in the summer normally compare with sales in other seasons for Theall's.

So, information on how sales in the summer compared with sales in other seasons isn't useful for determining whether the increase in sales last summer can be attributed to the increase in advertising spending.

Eliminate.

Correct answer:   D

elslyknight · Answer

Deciding between C and D - let's take the extreme answers to the questions and see which one surely has opposite effects on the conclusion.

C
 
 Major portion of increase in sales is attributable to repeat customers
 
 if the advertisement was targetted to repeat customers, the advertisement works - Strengthens the arguement 
 if the advertisement was generic - Does nothing to the argument.  
 
 Small portion of increase in sales is attributable to repeat customers.
 
 Similar to above - targeted to repeat customers - Weakens 
 Generic - Does nothing

The problem with C is that there are more things which need to be asked about the advertisement, C in itself doesn't reveal anything conclusively about the viability of the conclusion.

D
 
 Other retail stores did well - Highly likely that the economic conditions/retail consumption was greater overall - Weakens argument. 
 Other retail stores did flat OR poorly - Pretty much attributable to the ads that Theall did much better - Strengthens argument.

D is our answer.

MartyMurray · Answer

Nice work - a well-organized, cogent way of handling the two choices.

IZ19 · Answer

(C) What proportion of the increase in sales can be attributed to repeat customers spending more at Theall’s last summer than they spent the previous summer.

If you know how much sales increase come from exisitng customers, you can calcualte sales coming from new customers, which were likely to have been attracted by advertising

MartyMurray · Answer

That's not really the case.

Advertising can cause existing customers to shop more too.

We have to be careful use only clearly supported ideas to support our answers.

lulomfds · Answer

Why Option D? We don't know much about the other stores. What if they also increased advertising, yet did worse than Thealls?

DmitryFarberMPrep · Answer

We aren't concerned with the advertising success of other stores, since those would be different campaigns, and they wouldn't reflect on whether this one was successful. The reason we care about other stores at all is that we want to make sure any change at Thealls is not just part of a general trend. It's like if a company fires their CEO and the stock drops 10% the next day. Was it because of the firing? What if it turned out that most stocks dropped 10% or more that day? Then maybe it was some broader thing going on, and the drop occurring right after the firing was just a coincidence.

lulomfds

Why Option D? We don't know much about the other stores. What if they also increased advertising, yet did worse than Thealls?

Since Thealls, a retail store located in Beach Haven,

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Since Thealls, a retail store located in Beach Haven,

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