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Don

by raunekk » Mon Aug 11, 2008 4:55 am
Don’s, a chain of supermarkets, has entered into an agreement in which Rose Computers will sell Don’s an unlimited number of its least expensive PC’s at one-fourth the regular wholesale price. In return, Don’s has agreed to purchase all of its scanners and other electronic information-processing equipment from Rose or from Omicron, Rose Computers’ parent company, for the next ten years. Don’s will offer a Rose PC free to any school that turns in Don’s register receipts totaling $100,000 within the next six months. The vice-president in charge of advertising for Don’s expects that the computer giveaway will obviate the need for a massive new advertising campaign for the next six months and that Don’s can make up the expenditures for the PC’s by writing them off its income taxes as charitable donations.
The plans formulated by Don’s assume each of the following EXCEPT:
(A) The prices that Rose or Omicron charges Don’s for information-processing equipment over the next ten years will be lower than those charged by other companies.
(B) The tax laws will not be changed to exclude or lessen the value of charitable donations as tax write-offs.
(C) Schools will be sufficiently attracted by Don’s computer giveaway offer that teachers will urge students to shop at Don’s.
(D) Rose will be able to supply Don’s with a sufficient number of PC’s to meet the demand generated by schools that collect Don’s receipts totaling $100,000.
(E) The effect of the computer giveaway offer on Don’s business will be comparable to that of a major advertising campaign.
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by Vignesh.4384 » Mon Aug 11, 2008 6:38 am
IMO A
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by raunekk » Mon Aug 11, 2008 6:45 am
@Vignesh.4384

No doubt the answer is A...

But i am looking for the reasoning behind it.
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by Vignesh.4384 » Mon Aug 11, 2008 7:02 am
raunekk,

I just wanted to know if my answer was right so that i dont give wrong suggestions..

(A) The prices that Rose or Omicron charges Don’s for information-processing equipment over the next ten years will be lower than those charged by other companies. -------- > The passage only says that " Don’s, a chain of supermarkets, has entered into an agreement in which Rose Computers will sell Don’s an unlimited number of its least expensive PC’s at one-fourth the regular wholesale price. In return, Don’s has agreed to purchase all of its scanners and other electronic information-processing equipment from Rose". the passage never says anything about the competitors .. It only says that So this has 2 be it ... For all u know.. some other competitor might actually be selling information-processing equipment at a cheaper price even when Dons made the agreement.

(B) The tax laws will not be changed to exclude or lessen the value of charitable donations as tax write-offs. -----> The passage mentions that Don’s can make up the expenditures for the PC’s by writing them off its income taxes as charitable donations . This statement is therefore assumed.

(C) Schools will be sufficiently attracted by Don’s computer giveaway offer that teachers will urge students to shop at Don’s.--------> This is the basic assumpton the passage makes . IT talks about giving a pc free to any school that turns in Don’s register receipts totaling $100,000 within the next six months. therefore it assumes that teachers wil recomend this to the students

(D) Rose will be able to supply Don’s with a sufficient number of PC’s to meet the demand generated by schools that collect Don’s receipts totaling $100,000. --------> Passage says "Don’s has agreed to purchase all of its scanners and other electronic information-processing equipment from Rose or from Omicron, Rose Computers’ parent company, for the next ten years" . therefore the author assumes that Rose will be able to meet dons demands

(E) The effect of the computer giveaway offer on Don’s business will be comparable to that of a major advertising campaign. ----------> Passage says "Don’s expects that the computer giveaway will obviate the need for a massive new advertising campaign for the next six months". there for passage suppors the assumption Dons could eliminate the advertising campaign

Hope it help.

Regards,
Vignesh
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by raunekk » Mon Aug 11, 2008 7:09 am
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Vignesh.4384

thanks,. :)

i think i am confused within the stimulus itself!!

thanks a lot.
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by ildude02 » Mon Aug 11, 2008 11:54 am
I still didn't quite understand the resoning behind A. I f A wasn't assumed , how can it make a 10 year deal to purchase the equipement. So I would normally assume that's an assumption it made before it went with the contract. I would have went with C if I dind't know the answer.

Can anyone have a better reasoning as to why A is the correct choice. Appreciate it.
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by raunekk » Mon Aug 11, 2008 12:26 pm
ildude02


even i havent understood d stimulus yet... :wink:
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by ildude02 » Mon Aug 11, 2008 1:03 pm
Since now that we know the answer is A, we have the luxury to dig deep to see why A is right :)

I'm thinking more in this line, the main point of the passage is about COMPUTERS and how the Don's store can market the computers for a profit. So the assumptions the store would make should be more in line with how they can profit out fo the computer marketing.

As for A, there is no need for Don's store to asume that the prices of the equipmenet charged by ROSS is lower then other competetor as long as it can assume the deal it made will be profitable nonethless with Computer marketing. Besdies, if we use the negation rule for A as in, what if the prices charged were not lower by competetors, but may be they are charging the SAME, still the store can be profitable. Also, what if the store's computer profit can outweight the the prices charged by other competetors. Well, that's the reason A may be correct.

But I'm still not sure why the store should assume that the teachers will urge students to shop.
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by Vignesh.4384 » Mon Aug 11, 2008 8:46 pm
ildude02,

I think this one is easy .

If u read the passage carefully it says:

1) Don’s entered into an agreement in which Rose Computers.

2) Rose Computers will sell Don’s an unlimited number of its least expensive PC’s at one-fourth the regular wholesale price

3)In return, Don’s has agreed to purchase all of its scanners and other electronic information-processing equipment from Rose or from Omicron, Rose Computers’ parent company, for the next ten years

The passage only says that Rose will provide Dons with pcs for one-fourth the regular wholesale price. In return Don's has agreed to purchase electronic information-processing equipment. the passage does not say if the electronic information-processing equipment is given to Dons by rose at a cheapest price .. Option A says exactly this ..
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by pkit » Thu Jul 29, 2010 8:53 am
I got this wrong as well. Went for C.
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