GMAT Essays (AWA)

. Argument:

The following appeared as part of an annual report sent to stockholders by Olympic Foods, a processor of frozen foods:

"Over time, the costs of processing go down because as organizations learn how to do things better, they become more efficient. In color film processing, for example, the cost of a 3-by-5-inch print fell from 50 cents for five-day service in 1970 to 20 cents for one-day service in 1984. The same principle applies to the processing of food. And since Olympic Foods will soon celebrate its 25th birthday, we can expect that our long experience will enable us to minimize costs and thus maximize profits."

Analysis:
The annual report discusses the cost of processing food and states that the cost goes down with time. It states that the celebration of birthday will help Olympic foods to minimize cost and maximize profits. The argument is completely flawed and does not provide complete information.

Firstly, the comparison made of frozen foods to colour film processing is unbiased, and relation between food and colour film processing cannot be made as both are different in their characteristics. Since, food is a need and colour film processing is a requirement that is, it may or may not be required.

Also, the comparison made between 5 day service price of 50 cents in 1970 to one day service price of 20 cents in 1984 cannot be compared with processing of food, because the price of food in 1970 will be completely different to the price of colour film processing, and the service plan of 5 day in 1970 and 1 day in 1984 is not required in food.

In addition to the information provided about Olympic foods celebrating their 25th birthday will minimize cost and maximize profit is not at all related to each other, as celebration of birthday is not a valid factor for considering the increase or decrease in cost or profit. Therefore, no relation can be established between companys birthday and cost/profit.

The annual report is highly inconclusive and dubious and does not provide a valid relation, as the examples provided in comparing the frozen food processor to colour film printing is not at all in sync, for eg, it is a road with different directions, and the comparison of celebration of birthday to costs and profits is not a valid statement. And if advise is followed better report can be prepared with more information and better examples.