Critical Reasoning

There is relatively little room for growth in the
overall carpet market, which is tied to the size of the
population. Most who purchase carpet do so only
once or twice, first in their twenties or thirties, and
then perhaps again in their fifties or sixties. Thus as
the population ages, companies producing carpet
will be able to gain market share in the carpet market
only through purchasing competitors, and not
through more aggressive marketing.
Which one of the following, if true, casts the most
doubt on the conclusion above?
(A) Most of the major carpet producers market
other floor coverings as well.
(B) Most established carpet producers market
several different brand names and varieties,
and there is no remaining niche in the
market for new brands to fill.
(C) Two of the three mergers in the industry's last
ten years led to a decline in profits and
revenues for the newly merged companies.
(D) Price reductions, achieved by cost-cutting in
production, by some of the dominant firms
in the carpet market are causing other
producers to leave the market altogether.
(E) The carpet market is unlike most markets in
that consumers are becoming increasingly
resistant to new patterns and styles.



Please explain options C and D.

A) Out of scope. What is being discussed is the carpet market.

B) If anything this bolsters the argument.

C) The argument is about market share, which is the fraction of the total market represented by the volume sold or revenues of a particular company. While a merger may lead to a decline in revenue for the newly merged company, the company may still have gained market share via the merger.

In other words, Company A may merge with Company B. The new company may not have as much revenue the sum of the revenues of A and B, but the new company may still have a market share larger than that held individually by either company before the merger.

D) If by cutting prices, the larger firms are getting other companies to leave the market, then the larger firms may have found a way to gain market share, because the total market revenues may remain the same, or even decrease because of the price reductions, but fewer companies are now involved in the market. So the remaining companies may have market shares greater than those they had when there were more companies.

E) This is out of scope. The argument is about market share rather than overall market trends.

So the best answer is D.

Can we eliminate option c here because "While answering a weaken question, we should be wary of answer choices that include some or many. "

we can say option E like "many mergers have failed during the last 10 years"

From this also we can eliminate C?




Is MANY = SOME = Atleast 1 ?

vishalwin wrote:

Is MANY = SOME = Atleast 1 ?

Some = at least 1
Many = a large number

vishalwin wrote:Can we eliminate option c here because "While answering a weaken question, we should be wary of answer choices that include some or many. "

we can say option E like "many mergers have failed during the last 10 years"

From this also we can eliminate C?

I think that you put it well when you said "we should be wary of answer choices that include some or many." Being wary of certain answer choices is different from being confident that you can eliminate those answer choices.

In order to score on verbal higher than you have been, you need to seek to be crystal clear about the logic that makes certain answer choices wrong and certain ones right. Being wary of an answer choice implies that you are not yet truly sure about why that answer choice is wrong and that actually for all you know it could be the OA.

Thus asthe population ages,companies producing carpet will be able to gain market share in the carpet market
only through purchasing competitors, and not through more aggressive marketing.

Argument says word "only".

We have to find out some other way in which competitor can be eliminated.

D does it nicely.

Hence D[/i]