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# V04-18

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Math Expert
Joined: 02 Sep 2009
Posts: 51218

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16 Sep 2014, 01:01
00:00

Difficulty:

25% (medium)

Question Stats:

81% (01:04) correct 19% (01:22) wrong based on 31 sessions

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Which of the following best completes the passage below?

A recent downturn in the national economy has led retailers to expect lower sales during the upcoming holiday season. In an attempt to prevent losses during the most important quarter of the year, the owner of Suzy’s Gift Shop has decided to offer even deeper discounts than usual during the annual holiday sale, hoping that .

A. the economy will actually improve during the holiday season
B. shoppers also suffering from the economic downturn will recognize the generous gesture and patronize the store
C. the amount of money spent advertising the sale can be recovered by an increase in purchases
D. lower prices will attract enough extra shoppers to make up for the recent downturn in the economy.
E. shoppers will enter the holiday spirit and spend more money in the store than they have in previous months

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Math Expert
Joined: 02 Sep 2009
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16 Sep 2014, 01:01
Official Solution:

Which of the following best completes the passage below?

A recent downturn in the national economy has led retailers to expect lower sales during the upcoming holiday season. In an attempt to prevent losses during the most important quarter of the year, the owner of Suzy’s Gift Shop has decided to offer even deeper discounts than usual during the annual holiday sale, hoping that .

A. the economy will actually improve during the holiday season
B. shoppers also suffering from the economic downturn will recognize the generous gesture and patronize the store
C. the amount of money spent advertising the sale can be recovered by an increase in purchases
D. lower prices will attract enough extra shoppers to make up for the recent downturn in the economy.
E. shoppers will enter the holiday spirit and spend more money in the store than they have in previous months

Situation:The owner of a gift shop hopes to make up for a recent economic downturn by offering deeply discounted sale prices.

Reasoning: Which option best completes the passage? Because the economy has recently been slow, retailers, such as the owner of Suzy’s Gift Shop, expect sales to be lower during the important holiday shopping season. The owner of the store hopes that more drastic discounts during the annual holiday sale will prevent losses. The correct answer choice will describe a way in which lower sale prices can actually lead to greater profit: by attracting more customers.
1. The passage does not make this suggestion.
2. Whether shoppers view lower sale prices as generous does not affect the soundness of the plan.
4. If lower sale prices attract enough extra shoppers, the overall profit margin of the store will increase.
5. Though the owner does likely hope that shoppers will spend more money, the passage does not state that the holiday spirit is part of the plan.

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Joined: 16 Mar 2015
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02 Apr 2016, 08:29
I think this is a poor-quality question and I don't agree with the explanation. The correct answer seems to indicate that the lower prices will effect the economy as a whole. That is not the intention of the company's strategy; the intention of the company's strategy is to effect its business position.
Manager
Joined: 19 Jul 2015
Posts: 61
Location: India
GMAT 1: 720 Q51 V35
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12 Jul 2016, 09:12
Jak5189 wrote:
I think this is a poor-quality question and I don't agree with the explanation. The correct answer seems to indicate that the lower prices will effect the economy as a whole. That is not the intention of the company's strategy; the intention of the company's strategy is to effect its business position.

I too feel the choice is being written as if the sale will make up for the economy as a whole whereas the shop owner is just concerned with his business. Also, I feel choice E can be correct as holiday season is specifically mentioned in the argument so people will be holiday spirit is not too far to infer.

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Joined: 14 Dec 2013
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Location: Germany
Schools: German MBA
GMAT 1: 780 Q50 V47
WE: Corporate Finance (Pharmaceuticals and Biotech)

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12 Jul 2016, 18:33
Navinder wrote:
Jak5189 wrote:
I think this is a poor-quality question and I don't agree with the explanation. The correct answer seems to indicate that the lower prices will effect the economy as a whole. That is not the intention of the company's strategy; the intention of the company's strategy is to effect its business position.

I too feel the choice is being written as if the sale will make up for the economy as a whole whereas the shop owner is just concerned with his business. Also, I feel choice E can be correct as holiday season is specifically mentioned in the argument so people will be holiday spirit is not too far to infer.

It appears that both of you have misinterpreted the meaning of the phrasal verb "make up for" - this phrasal verb means "to take place of something that has been lost or damaged", and hence there is no indication in option D that the intention of low price is to revive economy, it is clear that the low price is offered in order to make up for or to compensate for the economic downturn.

Option E is not the reason for lowering the price - if people spend more money because they would enter the holiday spirit, then there is no justification for lowering the price at all - anyway they would be spending money irreespective of whether the price is lowered.
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Joined: 03 Apr 2015
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02 Sep 2017, 07:05
sir
I am not refuting your explanation but the economy mentioned is of the whole nation ,the economic situation of the shoppers could very well be growing :just they are expecting lower sales
so if the answer choice had said that the enough customers will be attracted to offset the fear of lowering sale then the option would have been correctly worded
Intern
Joined: 23 Sep 2017
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29 Nov 2017, 04:31
a Terrific question. Really gritty.
Re: V04-18 &nbs [#permalink] 29 Nov 2017, 04:31
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# V04-18

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