The rate of growth in global coffee consumption has been falling

Question

The passage is based on a document published in 2005.

The rate of growth in global coffee consumption has been falling behind the rate of growth in global production, creating a scenario of recurring price crises that take a heavy toll on coffee producing countries. Programs to expand coffee consumption in coffee producing countries can improve the situation and make the cyclical crises less acute.

In mature markets, costs to increase consumption are probably higher than in emerging markets, such as Brazil, the largest coffee producer. The case of Brazil shows that probably the highest returns for institutional investments to develop coffee consumption are to be found in the emerging markets of coffee producing countries. A Brazilian institutional investment valued at US$25 million in 10 years brought about an increase in yearly coffee sales worth 40 times as much. Promotion of coffee consumption in coffee producing countries is likely to represent the best investment of scarce promotion resources because of this multiplier effect. There are huge gaps in per capita consumption between Brazil and many other smaller producers, some (such as Indonesia) with large populations.

It is often argued that the Brazilian promotion program worked only because there was a marked income increase within the same period. But income increases alone, without promotion, are not sufficient to increase coffee consumption. Actually, for the 20 years up to 2003 in Brazil, it was only during the period 1993 to 1998 that coffee consumption increased as income was increasing.

Bunuel · Accepted Answer

In Q3 the stem itself says: assuming each statement is true, select Yes if it helps explain the second graph and stays consistent with the passage. So we must treat every option as a hypothetical premise. Saying “If ...” and “could help explain” is exactly what the question asks us to test. It is not adding extra assumptions.

• Brazil’s 10-year program to promote domestic coffee consumption through institutional investment began in 1993.

If the program began in 1993, it directly explains the sustained rise in consumption from the mid 1990s onward, including years when income declines. It shows why consumption grows despite weaker income.

Answer: Yes.

• Worldwide demand for coffee began to fall in 1999, resulting in economic recessions in most coffee producing countries.

A global demand drop lowers world prices and export revenue in producing countries. In the graph, Brazil’s income peaks in the late 1990s and then falls from 1999 to 2003. That matches the statement and explains the decline in the black income line.

Answer: Yes.

• The trend in per capita consumption of coffee in Brazil between 1986 and 2003 is indicative of the trend in the global per capita rate of production.

Graph 2 shows only Brazil’s per capita consumption and per capita income. The statement is about global per capita production, which is not in the graph. It also gives no reason for why Brazil’s consumption rises in the mid 1990s or why income falls after the late 1990s. So it does not explain any trend in the graph.

Answer: No.

Bunuel · Answer

2. Which one of the following data ranges in the second graph most clearly indicates that the final sentence of the Discussion tab involves oversimplification?

The final sentence in the Discussion tab says that coffee consumption in Brazil increased along with income only during 1993 to 1998. But the second graph shows that both income and consumption also rose between 1988 and 1989. That period contradicts the claim, proving the statement is an oversimplification.

The correct answer is 1988 to 1989.

nihilre

in 2nd question, to contradict the oversimplification, i could also choose a period where income decreases and demand increases (1998-2003)? Why/Why not. pls help Bunuel KarishmaB @chetan4u

The final sentence claims that coffee consumption in Brazil increased only when income was rising (1993-1998).

A contradiction would be another period when both income and consumption rose together, showing that this pattern wasn’t unique to 1993-1998.

The period you mention, 1998-2003, isn’t that. Income fell while consumption rose. That’s not a contradiction, it’s simply a different pattern, showing that consumption can rise even when income declines.

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Bunuel · Answer

1. For each of the following statements, select Yes if, based on the information provided in the passage or the first graph or both, the statement would have been true in 2003. Otherwise, select No.

• Coffee production and per capita coffee consumption in Brazil are significantly higher than in most of the major coffee producing countries.

The text in the first graph says that in 2003 Brazil’s production was much higher than that of Central America, which has the highest production among all shown in the graph. This means Brazil had the highest coffee production overall. The graph also shows that Brazil’s per capita consumption was 4.5 kilograms, which is much higher than the second highest, Costa Rica, at about 3 kilograms.

Answer: Yes.

• The coffee consumed in the major coffee producing countries comes entirely from domestic production.

Neither the passage nor the graph says that all coffee consumed in these countries comes from domestic production. The first graph only shows how much coffee each country produces and consumes but does not indicate where the consumed coffee comes from. Therefore, we cannot conclude that consumption is entirely domestic.

Answer: No.

• As a means of boosting world coffee demand, increasing consumption of domestically produced coffee has greater potential in India than in China.

The graph shows that India produces much more coffee than China. Both countries have similar very low per-capita coffee consumption and similar large populations (similar bubble sizes). Since India’s domestic production is far greater, promoting internal coffee consumption there could absorb more of its own output and contribute more to global demand growth. Hence, the potential is greater in India than in China.

Answer: Yes.

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Apt0810 · Answer

1)A)Yes,since coffee production per capita is 4.5 which is highest among all countries and it is also mentioned in the First graph that Brazil's coffee production was higher than that of Central America,which is already on the right most end of x-axis of the graph
B)No,this cannot be said since the consumption might be from domestic or imports from other countries.
C)Yes,since India produces more coffee than China and also the bubble size is greater for India than for China so the mentioned statement is correct

2)D, Since from 1988 to 1989 the monthly income Increased and also the per consumption Increased,so the last statement mentioned in the discussion that only increase without promotion is not sufficient is wrong and it needs simplification.

3)a)Yes,since there is a statement made in the discussion that "A Brazilian institutional investment valued at US$25 million in 10 years brought about an increase in yearly coffee sales worth 40 times as much",so here the 10 years period starts from 1993 since the data is talking about the 2003 values
b)Yes,since Brazil's monthly income started falling from 1999 and the per capita consumption Increased but the overall consumption in 2003 was Highest in Brazil and it was lower in other countries so most of the countries might have felt the recession
c)No,since condition of other countries is not known so we cannot comment on the global per capita rate of production

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akshaygup · Answer

Can you explain the answer for 2 again- 
in Graph 2 I see a fall in income from 1998 to 1999 - and an increase in consumption: What am I missing

BLTN · Answer

There are two cues for you,
First, the question is not provided option that you are alluded.
Second, pursuant to the last assertion, 
 Actually, for the 20 years up to 2003 in Brazil, it was only during the period 1993 to 1998 that coffee consumption increased as income was increasing.

There is a period when the trends of both curves coincide.
Thus, to rebut the argument, you ought to find a period out of mentioned diapason.
Whereas your option is crossed one of the borders - 1998.

Hope it helps.

Sajjad1994 · Answer

Official Explanation

1. For each of the following statements, select Yes if, based on the information provided in the passage or the first graph or both, the statement would have been true in 2003. Otherwise, select No.

The first graph indicates that it includes, for each major coffee-producing country other than Brazil, the amount of coffee produced by the country in 2003 and the per capita amount of coffee consumed by the country. The line at the top of the graph indicates that Brazil's per-capita coffee consumption in 2003 is 4.5 kg per year, greater than that of each of the other countries in the graph. The text accompanying the graph indicates that Brazil's coffee production exceeds that of Central America. The graph indicates that each of the major coffee-producing countries in 2003 produced less than the combined production of the countries of Central America. Therefore, each of the major coffee-producing countries produced less coffee in 2003 than did Brazil.

The correct answer is Yes.

While both the discussion and the first graph pertain to coffee consumption among those living in coffee-producing countries, neither suggests that this consumption comes entirely from coffee produced in that country.

The correct answer is No.

In the first graph, the roughly equal sizes of the bubbles representing India and China show that in 2003 those countries were roughly equal in population. And the bubbles' very low positions in the graph show that consumers in both countries consumed comparatively little coffee per capita. But the bubbles' positions along the horizontal axis show that in 2003 India produced about 5 million 60 kg bags of coffee, whereas China produced less than 500,000 60 kg bags of coffee. Much more coffee was domestically produced in India than in China, though the two countries were similarly large in population and low in per-capita coffee consumption; thus it appears that increasing consumption of domestically produced coffee had greater potential in India than in China to boost world coffee demand.

The correct answer is Yes.

2. Which one of the following data ranges in the second graph most clearly indicates that the final sentence of the Discussion tab involves oversimplification?

The Discussion tab's final sentence says "for the 20 years up to 2003 in Brazil, it was only during the period 1993 to 1998 that coffee consumption increased as income was increasing." If this sentence involves oversimplification, there must have been some period outside the years 1993 to 1998 during which both coffee consumption and income were increasing in Brazil. In the second graph, such simultaneous increases would be represented by both the blue bars and the black line increasing in height from left to right in a section of the graph representing some years before 1993 or after 1998. And indeed there is exactly one such section, representing the years 1988 and 1989, in which the blue bars and the black line both increase in height from left to right. So the data shown in the graph for the period 1988 to 1989 indicate that the Discussion tab's final sentence involves oversimplification.

The correct answer is D.

3. Assuming each of the following statements is true, select Yes if the statement helps explain trends shown in the second graph in a way that is consistent with information in the passage. Otherwise, select No.

The discussion indicates that the Brazilian institutional investment to develop domestic coffee consumption yielded a large increase in coffee sales over ten years. The second graph shows that Brazil's per capita coffee consumption increased steadily from 1995 through 2001 after several years of relative stability in the early 1990s. If Brazil's institutional investment program began in 1993, it could help explain that steady increase in per capita consumption from 1995 through 2001.

The correct answer is Yes.

The second graph shows that Brazil's per-capita monthly income fell significantly from 2000 to 2003. Since the passage indicates that Brazil was a major coffee-producing country, an economic recession resulting from a decline in worldwide demand for coffee beginning in 1999 could help explain this trend.

The correct answer is Yes.

If the statement is taken as an explanation of Brazil's increase in per-capita coffee consumption, it would conflict with the information in the passage indicating that the increase in consumption was due to institutional investment. If it is merely taken as a description of how Brazil's increase in per-capita coffee consumption coincided with the global per-capita rate of coffee production, it would have no explanatory value.

The correct answer is No.

KarishmaB · Answer

Note the question stem of question 3: Assuming each of the following statements is true, select Yes if the statement helps explain trends shown in the second graph in a way that is consistent with information in the passage.

The given statement needs to be taken to be true. We need to select 'Yes' if the statement helps explain the trend we see in graph 2 (regarding production & consumption in Brazil)

Given Statement 2: Worldwide demand for coffee began to fall in 1999, resulting in economic recessions in most coffee producing countries.

Brazil is a coffee producing country. We see that 1999 onwards, its monthly income is falling (the line graph shows monthly income). Recession can explain the downward trend in the monthly income. Hence, this statement does explain the trend. "YES"

Given Statement 3: The trend in per capita consumption of coffee in Brazil between 1986 and 2003 is indicative of the trend in the global per capita rate of production.
Graph 2 gives us the trend in per capita consumption of coffee in Brazil between 1986 and 2003 (the bar graph) but we are not given the trend in global production. This statement does not explain graph 2. Graph 2 does not give us global per capita rate of production. 
Hence, "NO".

Will2020

Will2020 · Answer

Hi KarishmaB ! Regarding Statement 2, I understand that Brazil could have faced an "economic recession", but how can I infer that OTHER countries were facing economic recession as well? Thank you for your explanation and your kindness!

KarishmaB · Answer

The statement is given to be true. Read the question stem again: Assuming each of the following statements is true, select Yes if the statement helps explain trends in the graph...

We don't have to explain the statement. It is what we know. Knowing this, we have to see if it explains the trend in the graph. If we know that recession had hit coffee producing countries, and we know that Brazil is a coffee producing country, then we can say that recession might have hit Brazil. Then the graph can be explained because the graph shows decreasing income. 
We are given the generic statement and are asked to explain the graph of Brazil based on that.

JoeAa · Answer

can someone explain why Q2 isn't 1994-1996?

chetan2u · Answer

The statement states that it was only during 1993-1998 period that both income and consumption increased. We have to find a timeperiod other than this that too follows the same relation.

1994-1996 is already a part of the period 1993-1998, and does not question the statement.
Only in 1987-1988, the increase in consumption is related to increase in income.
All other options either fall in 1993-1998 period or do not follow the directly proportional relation. for example 1998-2003 has income decreasing and per capita consumption increasing, thus agreeing to the statement.

pyroabhi · Answer

KarishmaB

Mam,
I have a doubt in Q2 of this MSR.
Initially my understanding of “oversimplification” was that “It is not true”.
However, I figured that it actually means ” to not provide a complete picture or all the factors affecting the issue ” .
Even, then I am not convinced how we arrived at the answer as mentioned there.

KarishmaB · Answer

'Simplification' means that some details have been glossed over.  'Oversimplification' means the some details have been glossed over, which should have been taken into account. This much simplification was uncalled for and perhaps made the statement incorrect.

Statement:
Actually, for the 20 years up to 2003 in Brazil, it was only during the period 1993 to 1998 that coffee consumption increased as income was increasing.

In second graph, we see that 1988 to 1989 too monthly income increases and coffee consumption increases too. That is why the statement becomes incorrect.

Dbrunik · Answer

What in the world is the explanation for this third question? It seems to be affirming that the answer should be yes when indeed it should be no for the reason that in the Grass they give you no information on per capita job growth or job growth in any way Just overall in income, which also says nothing about wage rates. It’s possible that they’re making more by working more at lower wages, not necessarily higher wages

For this reason, this official question is poorly written, or at least the answer explanation and should be revised

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For this reason, this official question is poorly written, or at least the answer explanation and should be revised

Confusion · Answer

But the consumption post 1999 has increased per-capita - and when we talk about recession it says demand decreases. how does both logically follow?

cheshire · Answer

I agree with you on this, all the explanations just say "they sold less coffee so they went into a recession and made less money" even though the graph clearly shows an increase in coffee sales. While a decrease in sales would explain a economic recession, the reasoning behind said recession is directly conflicted with our given data.

Confusion

But the consumption post 1999 has increased per-capita - and when we talk about recession it says demand decreases. how does both logically follow?

quialias · Answer

In 3rd question, you have assumed few things , statements like "If Brazil's institutional investment program began in 1993" and "could help explain this trend", clearly states the same, in GMAT I believe we should answer based on facts not on assumptions if not explicitly mentioned. Please clarify.

nihilre · Answer

in 2nd question, to contradict the oversimplification, i could also choose a period where income decreases and demand increases (1998-2003)? Why/Why not. pls help  Bunuel   KarishmaB  @chetan4u

	1998 to 2003
	1992 to 1994
	1987 to 1988
	1988 to 1989
	1994 to 1996

The rate of growth in global coffee consumption has been falling

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Yes	No
		Coffee production and per capita coffee consumption in Brazil are significantly higher than in most of the major coffee producing countries.
		The coffee consumed in the major coffee producing countries comes entirely from domestic production.
		As a means of boosting world coffee demand, increasing consumption of domestically produced coffee has greater potential in India than in China.

Yes	No
		Brazil’s 10-year program to promote domestic coffee consumption through institutional investment began in 1993.
		Worldwide demand for coffee began to fall in 1999, resulting in economic recessions in most coffee producing countries.
		The trend in per capita consumption of coffee in Brazil between 1986 and 2003 is indicative of the trend in the global per capita rate of production.

GMAT Multi-Source Reasoning (MSR) Questions

The rate of growth in global coffee consumption has been falling

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