Critical Reasoning

First-time computer buyers buying PXC home computers typically buy models that cost much less and have a smaller profit margin per computer than do PXC computers bought by people replacing their computers with more powerful models. Last year PXC's profits from computer sales were substantially higher than the previous year, although about the same number of PXC computers were sold and the prices and profit margins for each computer model that PXC sells remained unchanged.

If the statements above are true, which of the following is most strongly supported by them?

A) PXC's competitors raised the prices on their computers last year, making PXC computers more attractive to first-time computer buyers.

B) The number of people buying PXC computers who also bought PXC computer-related products, such as printers, was larger last year than the previous year.

C) Among computer buyers who bought a PXC computer to replace their existing computer, the proportion who were replacing a computer made by a competitor of PXC was greater last year than the previous year.

D) The proportion of PXC computers bought by first-time computer buyers was smaller last year than the previous year.

E) PXC's production costs for its computers were lower last year than they had been the previous year.

Discuss...

OA to follow...

IMO C.

This is a "must be true" question.

First sentence: first time buyers of PXC computers buy less expensive PXC

second sentence: Already users of PXC replace their computers with more powerful models

third sentence: profits were higher but neither the price nor the number of models changed.

no conclusion is given in the stimulus.

(C ) fills in the blank as to why the profits were higher even when nothing had changed.

IMO D

IMHO C

this is purely a mathematical question.

profit made from sales of computer - x and number = n
profit made from sale of computer replacing older computer - y
and number = m

y>x
n,m no. of pieces sold correspondingly

present yr profit > last yr. profit
(profit margin not changed/sale, n+m doesn't change)

so obviously m would have increased and n would have decreased.

(C)

Last year and this year:
Cost of a computer and the profit margin remained the same however PXC had more profits this year compared with last year.

D

All we can infer is that PXC must have sold less computers to first time buyers which is exactly what D says since PXC computers bought by people replacing their computers with more powerful models generate greater profits.

Regards,
CR

BlindVision wrote:First-time computer buyers buying PXC home computers typically buy models that cost much less and have a smaller profit margin per computer than do PXC computers bought by people replacing their computers with more powerful models. Last year PXC's profits from computer sales were substantially higher than the previous year, although about the same number of PXC computers were sold and the prices and profit margins for each computer model that PXC sells remained unchanged.

If the statements above are true, which of the following is most strongly supported by them?

A) PXC's competitors raised the prices on their computers last year, making PXC computers more attractive to first-time computer buyers.

B) The number of people buying PXC computers who also bought PXC computer-related products, such as printers, was larger last year than the previous year.

C) Among computer buyers who bought a PXC computer to replace their existing computer, the proportion who were replacing a computer made by a competitor of PXC was greater last year than the previous year.

D) The proportion of PXC computers bought by first-time computer buyers was smaller last year than the previous year.

E) PXC's production costs for its computers were lower last year than they had been the previous year.

Discuss...

OA to follow...

This question is straight from GMATPrep.

I did get the answer incorrect with "C".

OA=D

After a few re-reads, the premise in the first sentence explains it all...

"First-time computer buyers buying PXC home computers typically buy models that cost much less and have a smaller profit margin per computer than do PXC computers bought by people replacing their computers with more powerful models."

Btw C & D....I wld go with D

C states that "the proportion who were replacing a computer made by a competitor of PXC was greater"...but it may happen that the proportion who were replacing a computer made by PXC may be smaller that previous yr and the combined effect be neutral...

On the other hand, D precisely states the reason why profits were higher....

Guys between C and D its clearly D,

C states the opposite of what we want to conclude, since it says that the competitor got most of the customers last year than the previous.
While for the company to make profit larger needed to tap the replacing customers. I hope its clear

One more gotcha under time pressure(atleast for me sometimeback when I was practicing CR)

When the question states most strongly supported please dont get lured in to thinking straightaway its's a "STRENGTHEN QUESTION" In the question above it's a must be true or inference question.

If the statements above are true, which of the following is most strongly supported by them -> MUST BE TRUE wording


Which of the following if true, most strongly supports the information above-> STRENGTHEN

Just watch out for what's being asked....

Good luck!

Regards,
CR

Good points to be made, Cramya!

Time pressure does get the best of us.

vishal1702 wrote:Btw C & D....I wld go with D

C states that "the proportion who were replacing a computer made by a competitor of PXC was greater"

AHH fudgecakes! didn't see that one coming. CR so sneaky at hiding words...or maybe I am just going blind. IMO D then.

ssmiles08 wrote:

vishal1702 wrote:Btw C & D....I wld go with D

C states that "the proportion who were replacing a computer made by a competitor of PXC was greater"

AHH fudgecakes! didn't see that one coming. CR so sneaky at hiding words...or maybe I am just going blind. IMO D then.

smiles....I did the same thing!!! Ahhh have to avoid these stupid mistakes! D is OBVIOUSLY the correct answer. Dang it!

Another vote for C