The recent upheaval in the office-equipment retail

maihuna · Fri Jan 02, 2009 7:13 am

source is : Paper tests

QUESTION:
The recent upheaval in the office-equipment retail business, in which many small firms have gone out of business, has been attributed to the advent of office equipment "superstores" whose high sales volume keeps their prices low. This analysis is flawed, however, since even today the superstores control a very small share of the retail market.
Which of the following, if true, would most weaken the argument that the analysis is flawed?
(A) Most of the larger customers for office equipment purchase under contract directly from manufacturers and thus do not participate in the retail market.
(B) The superstores' heavy advertising of their low prices has forced prices down throughout the retail market for office supplies.
(C) Some of the superstores that only recently opened have themselves gone out of business.
(D) Most of the office equipment superstores are owned by large retailing chains that also own stores selling other types of goods.
(E) The growing importance of computers in most offices has changed the kind of office equipment retailers must stock.

Back to top

cramya · Fri Jan 02, 2009 4:43 pm

IMO the one that would most weaken the argument that the analysis is flawed is the one that supports it (i.e something that reveals that the analsyis is correct)

B does that -> The superstores' heavy advertising of their low prices has forced prices down throughout the retail market for office supplies.

Is this is true then the prices have gone down and the smaller retailers may not be able to match up their costs and hence their business may go on a decline. Thus the analysis that small firms have gone out of business, due advent of office equipment "superstores" whose high sales volume keeps their prices low becomes true.

Back to top

logitech · Fri Jan 02, 2009 9:41 pm

The recent upheaval in the office-equipment retail business, in which many small firms have gone out of business, has been attributed to the advent of office equipment "superstores" whose high sales volume keeps their prices low. This analysis is flawed, however, since even today the superstores control a very small share of the retail market.
Which of the following, if true, would most weaken the argument that the analysis is flawed?

So the argument says that the casuality in BLUE is flawed so we need to find an option that states that it is correct

VOLUME INCREASES --- > PRICE FALLS ( Little guys can't match up..and boom!)

(B) The superstores' heavy advertising of their low prices has forced prices down throughout the retail market for office supplies.

Back to top

Rashmi1804 · Mon Apr 13, 2009 6:54 am

The reason given by the critic is that "largestores have a small share in retial market"

But option B doesnt weaken this. Instead restates the reason already stated in the passage above -" the low prices offered by the largestores caused the shutdown of small businesses"

It like saying X is right....when critics says X is wrong, without any proper support.

HOW CAN THE LARGE BUSINESSES OFFER LOW PRICES INSPITE OF SMALL MARKET SHARE ??

Back to top

delhiboy1979 · Tue Apr 14, 2009 2:45 am

rashmi,

Well, B does look best of the worst. What other option can you think of. I think B is the closest that comes to supporting the analysis.

Back to top

Rashmi1804 · Mon Apr 20, 2009 11:12 pm

@delhiboy

Hey! i understood why i wasnt finding B correct. Actually i was also worried about the VALIDITY of the statements, which i shouldnt even bother about when the question clearly states , " ....IF TRUE ...." in the question stem.

thanks,
Rashmi

Back to top

anshulseth · Fri Apr 24, 2009 12:57 am

I am still not convinced with B.
Can you post the OA plz.

IMO it is A.

Back to top

lunarpower · Fri Jul 03, 2009 10:25 pm

tough problem.

remember that you must stay within the scope of the argument. you should develop a keen sense for what is, and what isn't, relevant to the issue(s) at hand.
in this problem, the argument is concerned solely with the retail market; non-retail business, such as the direct contracting mentioned in choice (a), is irrelevant to the discussion.

here's the basic skeleton of the argument:
* someone has attributed small firms' struggling in the equipment retail business to the entry of superstores into that retail market.
* this is flawed because the superstores control a low % of the market.

your goal here is to weaken the argument, which, as always, is done by undermining assumptions.
it's actually fairly straightforward to pick up on the key assumption in the argument here, because a connection is made, without any explicit justification, between (a) the superstores' low market share in the retail business and (b) their purported inability to affect the bottom line of the other firms in the business.
therefore, the argument (the original argument, which the narrator says is flawed) makes the following assumption: stores with a small market share can't possibly affect the other firms in the market.

therefore, we need to find an answer choice that gives a way in which stores can affect the other firms in the market even if those stores have a small market share.

choice (b) does this: the stores' heavy advertising is independent of their small market share, so this choice gives a way in which the superstores, despite a small market share, can have a significant impact on the rest of the market.

to reiterate, choice (a) is irrelevant, because the argument is concerned solely with the retail market, and so any consideration of the non-retail market is outside the scope of the argument.

Back to top

maihuna · Mon Jul 06, 2009 10:14 am

OA is B.

Thanks Ron you rock as always.

Regards,
maihuna

Back to top

The recent upheaval in the office-equipment retail

Free GMAT Prep Resources

Latest GMAT Articles

Latest GMAT Videos

Popular Resources