As you know, our revenues have declined for each of the past three qua

Question

Email from Marketing Director to Marketing Researcher on October 4, 2011.

As you know, our revenues have declined for each of the past three quarters. To address this issue, I suggest that we initiate a massive advertising buy. On three separate occasions, in 1978, 1987, and 1993, we responded to revenue decreases by increasing our advertising expenditures by 30%. On all three occasions, our revenues began to increase again within one quarter. Therefore, if we increase the number of advertisements targeted at our top consumers by 30%, we will once again increase our revenues.

Since our top consumers are females aged 15–25, determine the top two television programs watched by that group. Also, research the prices for a 30- second commercial for each television program.

Apt0810 · Answer

1)a)No,since there is no information provided for the other groups
b)No,we cannot make that judgement only by looking at a small group
c)No,since we just know the percentages and the not the exact numbers

2)Number of viewers of Blonde Fury = .45x(where x is total number of viewers between the age 15 & 25=20,000,000)
Number of viewers of Hart Attack = .35x
Number of viewers common for both shows = .35x*.8= .28x

So total number of viewers for either show = .45x+.35x-.28x =.52x
So neither =.48x = 9.6 millions

3)Yes to all since all of them can be inferred from the Email 1

Posted from my mobile device

kntombat · Answer

The answers for Question 1 are:
  1) NO    (The data present doesn't talk about any other gender or age group) 
  1) NO    (The data doesn't talk about how expensive the ads are based on their run time.) 
  1) NO    (We know the percentage of women and not their exact number, this data is also un inferable.)

The answer for Question 2 is:
20 * 0.45 + 20 * 0.35 - 20 * 0.35 * 0.8 - x = 20
x = 9.9
 Option D

The answer for Question 3 are:
  1) YES    (the first mail shows that this strategy has succeeded 3 times before.) 
  2) YES    (the First mail shows that this strategy did lead to an increase in revenue all the 3 times it had been used before .)
  3) YES    (Can be inferred from the first mail.)

Sajjad1994 · Answer

Official Explanation

2. If there are 20,000,000 females aged 15–25, then how many females aged 15–25 (in millions) watch neither Blonde Fury nor Hart Attack?

Email #1  describes the company’s plan to increase revenue by ramping up advertising to females aged 15−25.  Email #2  identifies the two most popular programs among females aged 15−25.  Memo #1  presents advertising and viewership data for the two programs.

According to  Memo #1 , 45% of females aged 15−25 watch Blonde Fury and 35% of females aged 15−25 watch Hart Attack. If there are 20,000,000 females aged 15−25, then 0.45 × 20,000,000 = 9,000,000 watch Blonde Fury, and 0.35 × 20,000,000 = 7,000,000 watch Hart Attack.

According to  Email #2 , 80% of female viewers aged 15−25 who watch Hart Attack also watch Blonde Fury. If 7,000,000 females aged 15−25 watch Hart Attack, then 0.80 × 7,000,000 = 5,600,000 who watch Hart Attack also watch Blonde Fury.

Use the group formula to answer the question, group 1 + group 2 + neither –both = total. Substitute the calculated values into the formula, so that 7,000,000 + 9,000,000 + neither – 5,600,000 = 20,000,000. Simplify the equation, so that neither = 9,600,000.

The correct answer is (D).

mkeshri185 · Answer

Can you explain why the answer of Q1 first part is NO?

It is said that Female (15-25) is our top consumer for the programs. So if any other age group or any other group watch more frequently than this one then how can be female (15-25) be top consumer?

Bunuel · Answer

We can infer that among females aged 15–25, Blonde Fury and Hart Attack are the two most watched programs. However, we cannot conclude that no other group watches these programs more frequently than this group. So, no other program is more popular among females aged 15–25, but we don’t know whether these two programs are watched even more by some other groups.

Nidhibatra · Answer

For C of 1st question, we can actually calculate and negate this. Even though we just know the % but base of both is same so it is possible to calculate the raio?

Bunuel · Answer

You cannot calculate that ratio. The data gives only the percentage of viewers and the cost per ad, not the total money spent, so the statement cannot be confirmed.

agrasan · Answer

Hi  KarishmaB   MartyMurray

In question-3, can we say that part-3 is "Yes" because the email-1 clearly jumps from a fact to a conclusion as stated below?

"On three separate occasions, in 1978, 1987, and 1993, we responded to revenue decreases  by increasing our advertising expenditures by 30% . On all three occasions, our revenues began to increase again within one quarter. Therefore,  if we increase the number of advertisements  targeted at our top consumers by 30%, we will once again increase our revenues."

KarishmaB · Answer

Yes, the director has maintained the same number of 30% for the increase in number of advertisements. So he is assuming that increasing the number of advertisements by 30% has a similar effect as increasing advertising expenditures by 30%.

WiziusCareers1 · Answer

Data Summary 
Target Audience: Females aged 15–25 ("top consumers").
Proposed Strategy: Increase the number of targeted advertisements by 30%.
Historical Data: Revenue increased in 1978, 1987, and 1993 after increasing expenditures by 30%.
Overlap Data: 80% of female viewers of Hart Attack also watch Blonde Fury.

Chart Data: 
Blonde Fury: $70,000/ad; 45% of target audience watches it.
Hart Attack: $55,000/ad; 35% of target audience watches it.

Question 1: Inference Statements 
 Statement 1: "No age and gender group watches Blonde Fury more frequently than do females aged 15–25." 
 Why NO:  The chart only provides data for the target demographic (females 15–25). While they are the "top consumers" for the company, we have no data on how many males or older females watch the show. We cannot infer they are the #1 group for the show itself.

Statement 2: "Thirty second advertisements are more expensive for programs with larger audiences." 
 Why NO:  While Blonde Fury is more expensive and has a larger share of the target audience, "larger audiences" implies total viewership. We do not have the total number of viewers for either show, only the percentage of a specific sub-group.

Statement 3: "The ratio of female viewers aged 15 to 25 to dollars spent on advertising for Hart Attack is greater than that for Blonde Fury." 
 Why NO:  Let's calculate the ratio of (Percentage of Viewers) / (Cost in Thousands):

Blonde Fury: 45/70 = 0.643 
Hart Attack: 35/55 = 0.636 
The ratio for Blonde Fury is actually higher than the ratio for Hart Attack.

Question 2: Overlap Calculation 
To find those who watch "neither," we first find the total percentage that watches at least one of the two shows (the Union).
Find the Intersection (Overlap): We are told 80% of Hart Attack viewers also watch Blonde Fury.
35% × 0.80 = 28% of the total population watches both.

Find the Union (Watchers of A or B):
Union = Viewers(BF) + Viewers(HA) − Overlap
45% + 35% − 28% = 52%.

Find the "Neither" group:
100% − 52% = 48%.

Calculate the final number:
48% of 20,000,000 = 0.48 × 20 = 9.6 million.

Question 3: Assumptions of the Marketing Director

Statement 1: "It is possible for a strategy that succeeded in the past to succeed again." 
 Why YES:  The Director explicitly uses historical successes from 1978, 1987, and 1993 to justify the current plan. This is the core assumption of the entire recommendation.

Statement 2: "The previous increases in revenues were attributable at least in part to the effect of increased advertising." 
 Why YES:  If the Director believed the previous revenue increases were just luck or caused by something else, they would not suggest increasing advertising now to achieve the same result.

Statement 3: "Increasing the number of advertisements has a similar effect on revenues, to increasing the amount of money spent on advertising expenditures." 
 Why YES:  This is a subtle but critical logical gap. The past success was based on increasing expenditures (money). The current plan is to increase the number of ads. The Director is assuming that these two different metrics will yield the same outcome.

	1.4
	4.0
	5.6
	9.6
	11.2

As you know, our revenues have declined for each of the past three qua

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Yes	No
		No age and gender group watches Blonde Fury more frequently than do females aged 15–25.
		Thirty second advertisements are more expensive for programs with larger audiences.
		The ratio of female viewers aged 15 to 25 to dollars spent on advertising for Hart Attack is greater than that for Blonde Fury.

Yes	No
		It is possible for a strategy that succeeded in the past to succeed again.
		The previous increases in revenues were attributable at least in part to the effect of increased advertising.
		Increasing the number of advertisements has a similar effect on revenues, to increasing the amount of money spent on advertising expenditures.

GMAT Multi-Source Reasoning (MSR) Questions

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