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05 Aug 2023, 12:00
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Difficulty:
65%
(hard)
Question Stats:
61% (01:49) correct
39%
(02:18)
wrong
based on 2064
sessions
History
Date
Time
Result
Not Attempted Yet
National Air negotiated an arrangement with a popular restaurant chain to give the chain's patrons booklets of coupons for discounts on National's flights. Marketing experts claimed that this promotion strategy would more effectively make National stand out relative to rival airlines serving the same routes than would directly setting its fares lower than those of its rivals.
Which of the following, if true, would best explain why, despite heavy demand for the booklets of coupons, National's market share did not increase in response to the promotion?
A. The restaurant chain distributing the coupons was initially skeptical about National's proposal.
B. Many of National's rivals widely advertised their willingness to honor National coupons.
C. Fewer people traveled by air during the period covered by the coupon promotion than had done so during the same period in the previous year.
D. During the month immediately preceding the beginning of the promotion, National negotiated a contract with the pilots' union.
E. Several airlines operating entirely in areas not served by National launched coupon promotions within the same week that National's promotion was launched.
Which of the following, if true, would best explain why, despite heavy demand for the booklets of coupons, National's market share did not increase in response to the promotion?
A. The restaurant chain distributing the coupons was initially skeptical about National's proposal.
B. Many of National's rivals widely advertised their willingness to honor National coupons.
C. Fewer people traveled by air during the period covered by the coupon promotion than had done so during the same period in the previous year.
D. During the month immediately preceding the beginning of the promotion, National negotiated a contract with the pilots' union.
E. Several airlines operating entirely in areas not served by National launched coupon promotions within the same week that National's promotion was launched.
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06 Aug 2023, 00:46
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We have to resolve the paradox that despite heavy demand for the booklets of coupons, National's market share did not increase in response to the promotion.
A. The restaurant chain distributing the coupons was initially skeptical about National's proposal.
While this option may indicate that the restaurant chain probably didn't distribute as many booklets of coupons initially, however when they started distributing the coupons, the market share of National Airline still did not increase in response to the promotion. We also know that the demand for booklets of coupons was high, hence, the anticipated result would be an increase in sales. We can hence, eliminate this option.
B. Many of National's rivals widely advertised their willingness to honor National coupons.
Perfect! This option gives us a reason for what actually happened. As other airlines were willing to honor the coupons of National Airlines, the patrons of the restaurants used the coupons to purchase tickets from the rivals. Hence, despite the high demand for coupons National's market share did not increase in response to the promotion.
Nice move National's rivals !
C. Fewer people traveled by air during the period covered by the coupon promotion than had done so during the same period in the previous year.
Doesn't help resolve the paradox. We are trying to find a reason why National's market share did not increase in response to the promotion. There isn't any aspect of comparison between the current year and the previous year.
D. During the month immediately preceding the beginning of the promotion, National negotiated a contract with the pilots' union.
Doesn't help resolve the paradox. We are trying to find a reason why National's market share did not increase in response to the promotion. Hence, we can eliminate this option.
E. Several airlines operating entirely in areas not served by National launched coupon promotions within the same week that National's promotion was launched.
This is a trap option. This statement talks about airlines operating entirely in areas not served by National airlines. Hence there is no overlap of flyers. We can eliminate this option.
Option B
17 Aug 2023, 16:02
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National Air negotiated an arrangement with a popular restaurant chain to give the chain's patrons booklets of coupons for discounts on National's flights. Marketing experts claimed that this promotion strategy would more effectively make National stand out relative to rival airlines serving the same routes than would directly setting its fares lower than those of its rivals.
Which of the following, if true, would best explain why, despite heavy demand for the booklets of coupons, National's market share did not increase in response to the promotion?
The correct answer will explain why, even though National Air negotiated an arrangement with a popular restaurant chain to give the chain's patrons booklets of coupons for discounts on National's flights and marketing experts claimed that that strategy would make National stand out relative to rival airlines, National's market share did not increase.
There are two key things we need to notice about what the correct answer must explain.
- It must explain something about "National's market share," not it's profits, number of passengers, revenue or any other metric.
- It must explain why National's market share did not increase. So, it doesn't have to explain a decrease or anything else other than a lack of an increase.
A. The restaurant chain distributing the coupons was initially skeptical about National's proposal.
Notice that the passage says that "National Air negotiated an arrangement with a popular restaurant chain." So, even if the restaurant chain was "initially skeptical," it did agree to give its patrons the coupons.
So, the information provided by this choice doesn't change what we know that's relevant to the situation since initial skepticism on the part of the chain doesn't change the fact that the plan appears to have been implemented.
Eliminate.
B. Many of National's rivals widely advertised their willingness to honor National coupons.
If we consider this choice carefully, we see that it explains why National did not stand out and increase market share because of the coupon promotion.
Our initial impression might be that, if many of National's rivals widely advertised their willingness to honor National coupons, National would have somehow benefited because its coupons were being honored.
Notice, however, that what this choice really means is that many of National's rivals jumped in on the promotion. They basically offered to do the same thing National was doing, taking the coupons and thus providing discounts on air travel.
So, we can see exactly why National didn't stand out and increase its market share. The other airlines did essentially the same thing National was doing at the same time.
Thus, this choice explains the surprising outcome.
Keep.
C. Fewer people traveled by air during the period covered by the coupon promotion than had done so during the same period in the previous year.
This choice is tricky because it could explain something related to what we have to explain but doesn't explain the right thing.
The fact that "fewer people traveled by air during the period covered by the coupon promotion than had done so during the same period in the previous year," would explain why National's revenue or number of passengers did not increase "despite heavy demand for the booklets of coupons." However, that outcome is not what the correct answer must explain.
The correct answer must explain why National's "market share" did not increase, and the fact fewer people traveled would not explain that outcome. After all, market share is not an absolute number of people. Rather, it's a proportion of the market. So, even if the overall market shrank because fewer people traveled, the promotion could have made National "stand out" and increase its "share" of the market.
Eliminate.
D. During the month immediately preceding the beginning of the promotion, National negotiated a contract with the pilots' union.
This choice is relatively straightforward to eliminate because there's no clear relationship between National's contract with the pilot's union and it's market share. So, unless we make up an extended, unsupported story, there is no reason to say that this choice explains why National's market share didn't increase.
Eliminate.
E. Several airlines operating entirely in areas not served by National launched coupon promotions within the same week that National's promotion was launched.
This choice is tempting because the fact that other airlines also launched coupon promotions could seem to explain why National's coupon promotion did not cause it to stand out or its market share to increase.
However, there's a key detail of this choice that we need to notice in order not to choose it: this choice is about "airlines operating entirely in areas not served by National." So, the airlines this choice is about are not in the same market that National is in. Thus, their coupon promotions wouldn't have any effect on National's market share.
So, this choice actually explains nothing about National's market share.
Eliminate.
The correct answer is (B).
Which of the following, if true, would best explain why, despite heavy demand for the booklets of coupons, National's market share did not increase in response to the promotion?
The correct answer will explain why, even though National Air negotiated an arrangement with a popular restaurant chain to give the chain's patrons booklets of coupons for discounts on National's flights and marketing experts claimed that that strategy would make National stand out relative to rival airlines, National's market share did not increase.
There are two key things we need to notice about what the correct answer must explain.
- It must explain something about "National's market share," not it's profits, number of passengers, revenue or any other metric.
- It must explain why National's market share did not increase. So, it doesn't have to explain a decrease or anything else other than a lack of an increase.
A. The restaurant chain distributing the coupons was initially skeptical about National's proposal.
Notice that the passage says that "National Air negotiated an arrangement with a popular restaurant chain." So, even if the restaurant chain was "initially skeptical," it did agree to give its patrons the coupons.
So, the information provided by this choice doesn't change what we know that's relevant to the situation since initial skepticism on the part of the chain doesn't change the fact that the plan appears to have been implemented.
Eliminate.
B. Many of National's rivals widely advertised their willingness to honor National coupons.
If we consider this choice carefully, we see that it explains why National did not stand out and increase market share because of the coupon promotion.
Our initial impression might be that, if many of National's rivals widely advertised their willingness to honor National coupons, National would have somehow benefited because its coupons were being honored.
Notice, however, that what this choice really means is that many of National's rivals jumped in on the promotion. They basically offered to do the same thing National was doing, taking the coupons and thus providing discounts on air travel.
So, we can see exactly why National didn't stand out and increase its market share. The other airlines did essentially the same thing National was doing at the same time.
Thus, this choice explains the surprising outcome.
Keep.
C. Fewer people traveled by air during the period covered by the coupon promotion than had done so during the same period in the previous year.
This choice is tricky because it could explain something related to what we have to explain but doesn't explain the right thing.
The fact that "fewer people traveled by air during the period covered by the coupon promotion than had done so during the same period in the previous year," would explain why National's revenue or number of passengers did not increase "despite heavy demand for the booklets of coupons." However, that outcome is not what the correct answer must explain.
The correct answer must explain why National's "market share" did not increase, and the fact fewer people traveled would not explain that outcome. After all, market share is not an absolute number of people. Rather, it's a proportion of the market. So, even if the overall market shrank because fewer people traveled, the promotion could have made National "stand out" and increase its "share" of the market.
Eliminate.
D. During the month immediately preceding the beginning of the promotion, National negotiated a contract with the pilots' union.
This choice is relatively straightforward to eliminate because there's no clear relationship between National's contract with the pilot's union and it's market share. So, unless we make up an extended, unsupported story, there is no reason to say that this choice explains why National's market share didn't increase.
Eliminate.
E. Several airlines operating entirely in areas not served by National launched coupon promotions within the same week that National's promotion was launched.
This choice is tempting because the fact that other airlines also launched coupon promotions could seem to explain why National's coupon promotion did not cause it to stand out or its market share to increase.
However, there's a key detail of this choice that we need to notice in order not to choose it: this choice is about "airlines operating entirely in areas not served by National." So, the airlines this choice is about are not in the same market that National is in. Thus, their coupon promotions wouldn't have any effect on National's market share.
So, this choice actually explains nothing about National's market share.
Eliminate.
The correct answer is (B).
