Critical Reasoning

Surveys show that every year only 10 percent of cigarette smokers switch brands. Yet the manufacturers have been spending an amount equal to 10 percent of their gross receipts on cigarette promotion in magazines. It follows from these figures that inducing cigarette smokers to switch brands did not pay, and that cigarette companies would have been no worse off economically if they had dropped their advertising.
19. Of the following, the best criticism of the conclusion that inducing cigarette smokers to switch brands did not pay is that the conclusion is based on
(A) computing advertising costs as a percentage of gross receipts, not of overall costs
(B) past patterns of smoking and may not carry over to the future
(C) the assumption that each smoker is loyal to a single brand of cigarettes at any one time
(D) the assumption that each manufacturer produces only one brand of cigarettes
(E) figures for the cigarette industry as a whole and may not hold for a particular company

You could easily defeat the argument if the 10 percent of people that switched brands all switched to one brand. Then the advertising did have an effect and was important, if only for one company. The argument assumes that this is not the case. For this reason I would chose E, which summarized what I just said.

Could you please confirm the OA is E?

Hope this helps.

Thanks,

Jared

i think D.

this_time_i_will wrote:i think D.

Please explain your reasoning.

SmarpanGamt wrote:Surveys show that every year only 10 percent of cigarette smokers switch brands. Yet the manufacturers have been spending an amount equal to 10 percent of their gross receipts on cigarette promotion in magazines. It follows from these figures that inducing cigarette smokers to switch brands did not pay, and that cigarette companies would have been no worse off economically if they had dropped their advertising.
19. Of the following, the best criticism of the conclusion that inducing cigarette smokers to switch brands did not pay is that the conclusion is based on
(A) computing advertising costs as a percentage of gross receipts, not of overall costs
(B) past patterns of smoking and may not carry over to the future
(C) the assumption that each smoker is loyal to a single brand of cigarettes at any one time
(D) the assumption that each manufacturer produces only one brand of cigarettes
(E) figures for the cigarette industry as a whole and may not hold for a particular company

IMO -- D
The conclusion states " That the advertising is not helping due to only 10% people shifting brands of the 10% spent on advertising.
If the manufacturerers hold multiple brands then the shifting might be within brands that beliong to them itself. The numbers given above dont hold good.

IM D

as Shawshank explained.

I will go with 'A'. Pls post OA.

Cheers

I'll go with E.

SmarpanGamt wrote:Surveys show that every year only 10 percent of cigarette smokers switch brands. Yet the manufacturers have been spending an amount equal to 10 percent of their gross receipts on cigarette promotion in magazines. It follows from these figures that inducing cigarette smokers to switch brands did not pay, and that cigarette companies would have been no worse off economically if they had dropped their advertising.
19. Of the following, the best criticism of the conclusion that inducing cigarette smokers to switch brands did not pay is that the conclusion is based on
(A) computing advertising costs as a percentage of gross receipts, not of overall costs
(B) past patterns of smoking and may not carry over to the future
(C) the assumption that each smoker is loyal to a single brand of cigarettes at any one time
(D) the assumption that each manufacturer produces only one brand of cigarettes
(E) figures for the cigarette industry as a whole and may not hold for a particular company

tricky one!

IMO A

Is 10% of gross income of the entire industry worth spending on advertisements and promotions...............may be yes may be no...........depends on whether this 10% is actually is a big portion of the total cost incurred or not

If the industry spends 50% of the gross income as a overall cost to company, this 10% will be a small portions when compared to the overall costs.

Please give inputs on this analysis.

FightWithGMAT wrote:

SmarpanGamt wrote:Surveys show that every year only 10 percent of cigarette smokers switch brands. Yet the manufacturers have been spending an amount equal to 10 percent of their gross receipts on cigarette promotion in magazines. It follows from these figures that inducing cigarette smokers to switch brands did not pay, and that cigarette companies would have been no worse off economically if they had dropped their advertising.
19. Of the following, the best criticism of the conclusion that inducing cigarette smokers to switch brands did not pay is that the conclusion is based on
(A) computing advertising costs as a percentage of gross receipts, not of overall costs
(B) past patterns of smoking and may not carry over to the future
(C) the assumption that each smoker is loyal to a single brand of cigarettes at any one time
(D) the assumption that each manufacturer produces only one brand of cigarettes
(E) figures for the cigarette industry as a whole and may not hold for a particular company

tricky one!

IMO A

Is 10% of gross income of the entire industry worth spending on advertisements and promotions...............may be yes may be no...........depends on whether this 10% is actually is a big portion of the total cost incurred or not

If the industry spends 50% of the gross income as a overall cost to company, this 10% will be a small portions when compared to the overall costs.

Please give inputs on this analysis.

OA : E....

spending 10% of gross receipts is not worth because only 10% change brands.
now it is possible that 10% of gross receipts change for brand M.

E