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Register now and save up to $200 Available with Beat the GMAT members only code • Magoosh Study with Magoosh GMAT prep Available with Beat the GMAT members only code • Free Practice Test & Review How would you score if you took the GMAT Available with Beat the GMAT members only code • 5-Day Free Trial 5-day free, full-access trial TTP Quant Available with Beat the GMAT members only code • Get 300+ Practice Questions 25 Video lessons and 6 Webinars for FREE Available with Beat the GMAT members only code • Free Veritas GMAT Class Experience Lesson 1 Live Free Available with Beat the GMAT members only code • 1 Hour Free BEAT THE GMAT EXCLUSIVE Available with Beat the GMAT members only code ## In the country of Veltria, the past two years' broad tagged by: RBBmba@2014 This topic has 5 expert replies and 4 member replies RBBmba@2014 Legendary Member Joined 30 May 2012 Posted: 888 messages Followed by: 4 members Thanked: 8 times #### In the country of Veltria, the past two years' broad Tue May 17, 2016 3:53 am Elapsed Time: 00:00 • Lap #[LAPCOUNT] ([LAPTIME]) In the country of Veltria, the past two years' broad economic recession has included a business downturn in the clothing trade, where sales are down by about 7 percent as compared to two years ago. Clothing wholesalers have found, however, that the proportion of credit extended to retailers that was paid off on time fell sharply in the first year of the recession but returned to its prerecession level in the second year. Which of the following, if true, most helps to explain the change between the first and the second year of the recession in the proportion of credit not paid off on time? (A) The total amount of credit extended to retailers by clothing wholesalers increased between the first year of the recession and the second year. (B) Between the first and second years of the recession, clothing retailers in Veltria saw many of their costs, rent and utilities in particular, increase. (C) Of the considerable number of clothing retailers in Veltria who were having financial difficulties before the start of the recession, virtually all were forced to go out of business during its first year. (D) Clothing retailers in Veltria attempted to stimulate sales in the second year of the recession by discounting merchandise. (E) Relatively recession-proof segments of the clothing trade, such as work clothes, did not suffer any decrease in sales during the first year of the recession. OA: C Source: OG 12,CR Qs.92 P.S: @Verbal Experts - could you please explain why option A is wrong ? As for Option D: I think,the usage of "attempted" results into unclear meaning because we don't know whether the sales were actually enough to pay off the credit! Right ? And, EVEN if we consider that the sales were STIMULATED,it doesn't really seem to clarify the INCONSISTENCY raised in the ARGUMENT because stimulating sales through DISCOUNTS still casts doubt that how feasible it might be in order to pay off the credit! Please share your thoughts! Need free GMAT or MBA advice from an expert? Register for Beat The GMAT now and post your question in these forums! ### GMAT/MBA Expert DavidG@VeritasPrep Legendary Member Joined 14 Jan 2015 Posted: 2292 messages Followed by: 115 members Thanked: 1061 times GMAT Score: 770 Tue May 17, 2016 4:18 am RBBmba@2014 wrote: In the country of Veltria, the past two years' broad economic recession has included a business downturn in the clothing trade, where sales are down by about 7 percent as compared to two years ago. Clothing wholesalers have found, however, that the proportion of credit extended to retailers that was paid off on time fell sharply in the first year of the recession but returned to its prerecession level in the second year. Which of the following, if true, most helps to explain the change between the first and the second year of the recession in the proportion of credit not paid off on time? (A) The total amount of credit extended to retailers by clothing wholesalers increased between the first year of the recession and the second year. (B) Between the first and second years of the recession, clothing retailers in Veltria saw many of their costs, rent and utilities in particular, increase. (C) Of the considerable number of clothing retailers in Veltria who were having financial difficulties before the start of the recession, virtually all were forced to go out of business during its first year. (D) Clothing retailers in Veltria attempted to stimulate sales in the second year of the recession by discounting merchandise. (E) Relatively recession-proof segments of the clothing trade, such as work clothes, did not suffer any decrease in sales during the first year of the recession. OA: C Source: OG 12,CR Qs.92 P.S: @Verbal Experts - could you please explain why option A is wrong ? As for Option D: I think,the usage of "attempted" results into unclear meaning because we don't know whether the sales were actually enough to pay off the credit! Right ? And, EVEN if we consider that the sales were STIMULATED,it doesn't really seem to clarify the INCONSISTENCY raised in the ARGUMENT because stimulating sales through DISCOUNTS still casts doubt that how feasible it might be in order to pay off the credit! Please share your thoughts! A is illogical. Think about it. In Year 1, the proportion of credit paid off on time goes down. In Year 2 the proportion of credit paid off on time goes back up to its previous levels, despite the fact that overall sales are still down. If retailers are receiving more credit in Year 2, that's more credit that needs to be paid off! (And who knows what motivated this increase in credit? Maybe sales were worse in Year 2 of the recession than Year 1, which makes the fact that a higher proportion of credit is getting paid off even more vexing.) _________________ Veritas Prep | GMAT Instructor Veritas Prep Reviews Save$100 off any live Veritas Prep GMAT Course

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RBBmba@2014 Legendary Member
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DavidG@VeritasPrep wrote:
A is illogical. Think about it. In Year 1, the proportion of credit paid off on time goes down. In Year 2 the proportion of credit paid off on time goes back up to its previous levels, despite the fact that overall sales are still down. If retailers are receiving more credit in Year 2, that's more credit that needs to be paid off! (And who knows what motivated this increase in credit? Maybe sales were worse in Year 2 of the recession than Year 1, which makes the fact that a higher proportion of credit is getting paid off even more vexing.)
@Dave - I hear you here...however, can we interpret A in this way:

The PROPORTION mentioned here is basically Credit Paid off on time/Total Credit to retailers by wholesalers. Am I correct ?

If so then to increase the above ratio in Year 2 per the ARGUMENT, we need to have either DENOMINATOR decreased or NUMERATOR increased (or BOTH happening at the same time). Now, the option A indicates that DENOMINATOR is increased, implying that the PROPORTION in Year 2 has gone down.

Hence,Option A is INCORRECT.

As for Option D, please let me know whether the following analysis is correct ?

The usage of "attempted" results into unclear meaning because we don't know whether the sales were actually enough to pay off the credit! Right ?
And, EVEN if we consider that the sales were STIMULATED,it doesn't really seem to clarify the INCONSISTENCY raised in the ARGUMENT because stimulating sales through DISCOUNTS still casts doubt that how feasible it might be in order to pay off the credit!

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Thu May 26, 2016 6:53 am
Quote:
The PROPORTION mentioned here is basically Credit Paid off on time/Total Credit to retailers by wholesalers. Am I correct ?

If so then to increase the above ratio in Year 2 per the ARGUMENT, we need to have either DENOMINATOR decreased or NUMERATOR increased (or BOTH happening at the same time). Now, the option A indicates that DENOMINATOR is increased, implying that the PROPORTION in Year 2 has gone down.

Hence,Option A is INCORRECT.
Looks good to me.

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Save $100 off any live Veritas Prep GMAT Course Thanked by: RBBmba@2014 Enroll in a Veritas Prep GMAT class completely for FREE. Wondering if a GMAT course is right for you? Attend the first class session of an actual GMAT course, either in-person or live online, and see for yourself why so many students choose to work with Veritas Prep. Find a class now! ### GMAT/MBA Expert DavidG@VeritasPrep Legendary Member Joined 14 Jan 2015 Posted: 2292 messages Followed by: 115 members Thanked: 1061 times GMAT Score: 770 Thu May 26, 2016 6:55 am Quote: As for Option D, please let me know whether the following analysis is correct ? The usage of "attempted" results into unclear meaning because we don't know whether the sales were actually enough to pay off the credit! Right ? And, EVEN if we consider that the sales were STIMULATED,it doesn't really seem to clarify the INCONSISTENCY raised in the ARGUMENT because stimulating sales through DISCOUNTS still casts doubt that how feasible it might be in order to pay off the credit! Curious to know your thoughts! Solid analysis. I'd include the caveat that we can't contradict a premise, so we know that sales are down over the two-year period, irrespective of whatever sale-boosting strategy may have been incorporated in year 2. _________________ Veritas Prep | GMAT Instructor Veritas Prep Reviews Save$100 off any live Veritas Prep GMAT Course

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DavidG@VeritasPrep wrote:
I'd include the caveat that we can't contradict a premise, so we know that sales are down over the two-year period, irrespective of whatever sale-boosting strategy may have been incorporated in year 2.
Yes, of course!

BTW, even if we we consider that the sales were STIMULATED in year 2 (COMPARED to year 1), it could well be that the sales were down over the two-year period as mentioned in the ARGUMENT. (So,anyway the INCONSISTENCY raised in the ARGUMENT still can't be clarified for the reason discussed above!)

Isn't it ?

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Thu May 26, 2016 7:17 am
RBBmba@2014 wrote:
DavidG@VeritasPrep wrote:
I'd include the caveat that we can't contradict a premise, so we know that sales are down over the two-year period, irrespective of whatever sale-boosting strategy may have been incorporated in year 2.
Yes, of course!

BTW, even if we we consider that the sales were STIMULATED in year 2 (COMPARED to year 1), it could well be that the sales were down over the two-year period as mentioned in the ARGUMENT. (So,anyway the INCONSISTENCY raised in the ARGUMENT still can't be clarified for the reason discussed above!)

Isn't it ?
Absolutely! But you're still left with the original conundrum: how could the proportion of credit paid off on time = pre-recession levels, when overall sales are down significantly? In other words, we can conjure some scenarios about what this attempt to increase sales means, but we can't consider the possibility that sales increased enough to reach pre-recession levels, leaving us to puzzle over the initial problem.

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Save $100 off any live Veritas Prep GMAT Course Enroll in a Veritas Prep GMAT class completely for FREE. Wondering if a GMAT course is right for you? Attend the first class session of an actual GMAT course, either in-person or live online, and see for yourself why so many students choose to work with Veritas Prep. Find a class now! RBBmba@2014 Legendary Member Joined 30 May 2012 Posted: 888 messages Followed by: 4 members Thanked: 8 times Thu May 26, 2016 9:32 am DavidG@VeritasPrep wrote: RBBmba@2014 wrote: DavidG@VeritasPrep wrote: I'd include the caveat that we can't contradict a premise, so we know that sales are down over the two-year period, irrespective of whatever sale-boosting strategy may have been incorporated in year 2. Yes, of course! BTW, even if we we consider that the sales were STIMULATED in year 2 (COMPARED to year 1), it could well be that the sales were down over the two-year period as mentioned in the ARGUMENT. (So,anyway the INCONSISTENCY raised in the ARGUMENT still can't be clarified for the reason discussed above!) Isn't it ? Absolutely! But you're still left with the original conundrum: how could the proportion of credit paid off on time = pre-recession levels, when overall sales are down significantly? In other words, we can conjure some scenarios about what this attempt to increase sales means, but we can't consider the possibility that sales increased enough to reach pre-recession levels, leaving us to puzzle over the initial problem. This is going pretty subtle, I guess...! I came up with the above logic on the basis of the following thoughts - Per the ARGUMENT, credit paid off on time = pre-recession levels in year 2 seems to IMPLY that in year 2, there have been MOST LIKELY (within the SCOPE of this CR) some scenarios that helped to restore the PROPORTION of credit paid off on time to pre-recession levels. Therefore, although overall sales are down significantly, COMPARATIVELY year 2 has come up with some sort of IMPROVED conditions for the retailers to pay off the credit on time in a better way than they did in year 1. That said, I inferred that Option A is STILL wrong because EVEN if we consider that the sales were STIMULATED in year 2 COMPARED to year 1 (yet,Overall sales could well be LOWER,satisfying the ARGUMENT), it doesn't really seem to clarify the INCONSISTENCY raised in the ARGUMENT because stimulating sales through DISCOUNTS in year 2 still COULD well cast doubt on the feasibility of the IMPROVED credit paid off on time in year 2 by the retailers! Am I able to make myself clear now ? ### GMAT/MBA Expert DavidG@VeritasPrep Legendary Member Joined 14 Jan 2015 Posted: 2292 messages Followed by: 115 members Thanked: 1061 times GMAT Score: 770 Mon May 30, 2016 8:12 am Quote: That said, I inferred that Option A is STILL wrong because EVEN if we consider that the sales were STIMULATED in year 2 COMPARED to year 1 (yet,Overall sales could well be LOWER,satisfying the ARGUMENT), it doesn't really seem to clarify the INCONSISTENCY raised in the ARGUMENT because stimulating sales through DISCOUNTS in year 2 still COULD well cast doubt on the feasibility of the IMPROVED credit paid off on time in year 2 by the retailers! Am I able to make myself clear now ? That looks like sound reasoning to me _________________ Veritas Prep | GMAT Instructor Veritas Prep Reviews Save$100 off any live Veritas Prep GMAT Course

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Hi Dave,
Much thanks for the confirmation.

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