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Daisy’s Lemonade

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by madhur_ahuja » Tue Aug 11, 2009 5:08 am
On Monday, Daisy’s Lemonade Stand sold lemonade at 20 cents per cup. The Lemon Shack sold lemonade at 30 cents per cup. At the end of the day, Daisy’s Lemonade Stand and the Lemon Shack reported identical revenues and identical profits.

The statements above best support which of the following assertions?
On Monday, Daisy’s Lemonade Stand sold fewer cups of lemonade than did the Lemon Shack.
The Lemon Shack sells higher quality lemonade than does Daisy’s Lemonade Stand.
On Monday, Daisy’s Lemonade Stand and the Lemon Shack incurred identical costs to run their businesses.
In general, lemonade consumers prefer the lemonade at Daisy’s Lemonade Stand to the Lemonade at the Lemon Shack.
The Lemon Shack would not increase its revenues by lowering its prices.
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Re: Daisy’s Lemonade

by ankit1383 » Tue Aug 11, 2009 5:20 am
IMO C
Since they have identical profits and identical revenue.. cost is identical

Revenue-Profit=Cost

HTH
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by vikram_k51 » Tue Aug 11, 2009 11:09 am
On Monday, Daisy’s Lemonade Stand sold lemonade at 20 cents per cup. The Lemon Shack sold lemonade at 30 cents per cup. At the end of the day, Daisy’s Lemonade Stand and the Lemon Shack reported identical revenues and identical profits.

The statements above best support which of the following assertions?
On Monday, Daisy’s Lemonade Stand sold fewer cups of lemonade than did the Lemon Shack.
The Lemon Shack sells higher quality lemonade than does Daisy’s Lemonade Stand.
On Monday, Daisy’s Lemonade Stand and the Lemon Shack incurred identical costs to run their businesses.
In general, lemonade consumers prefer the lemonade at Daisy’s Lemonade Stand to the Lemonade at the Lemon Shack.
The Lemon Shack would not increase its revenues by lowering its prices.
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by arjunnattar » Tue Aug 11, 2009 12:43 pm
I thought it was D since Daisy showed same amount of revenue and Profit and it is possible only if more Lemonade is consumed in Daisy's than the Shack's.
Warm regs,
Arjun
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by real2008 » Tue Aug 11, 2009 1:01 pm
vikram_k51 wrote:On Monday, Daisy’s Lemonade Stand sold lemonade at 20 cents per cup. The Lemon Shack sold lemonade at 30 cents per cup. At the end of the day, Daisy’s Lemonade Stand and the Lemon Shack reported identical revenues and identical profits.

The statements above best support which of the following assertions?
On Monday, Daisy’s Lemonade Stand sold fewer cups of lemonade than did the Lemon Shack.
The Lemon Shack sells higher quality lemonade than does Daisy’s Lemonade Stand.
On Monday, Daisy’s Lemonade Stand and the Lemon Shack incurred identical costs to run their businesses.
In general, lemonade consumers prefer the lemonade at Daisy’s Lemonade Stand to the Lemonade at the Lemon Shack.
The Lemon Shack would not increase its revenues by lowering its prices.
ur choosing ob B addresses 'identical revenues' but how does it justify for 'identical profit' unless u r sure of 'identical cost'
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by crackgmat007 » Tue Aug 11, 2009 1:09 pm
IMO - C since stimulus states that both have identical revenues and profits.
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by pandeyvineet24 » Tue Aug 11, 2009 1:22 pm
IMO C
I think both B is out of scope it describes the quality of lemonade,argument never talks about the quality of lemonade
In i think it goes far too beyond, argument lacks enough data to make that assertion (may be there are only 3 customers for Daisy and 2 for lemonade)

Madhur, Please post OA ?
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by arorag » Tue Aug 11, 2009 5:49 pm
it has to be
profit= rev.-cost
and it profit and rev are same then cost has to be same
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by madhur_ahuja » Tue Aug 11, 2009 8:05 pm
OA is C , Thanks all
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by eaakbari » Fri Dec 28, 2012 3:28 pm
madhur_ahuja wrote:On Monday, Daisy�s Lemonade Stand sold lemonade at 20 cents per cup. The Lemon Shack sold lemonade at 30 cents per cup. At the end of the day, Daisy�s Lemonade Stand and the Lemon Shack reported identical revenues and identical profits.

The statements above best support which of the following assertions?
On Monday, Daisy�s Lemonade Stand sold fewer cups of lemonade than did the Lemon Shack.
The Lemon Shack sells higher quality lemonade than does Daisy�s Lemonade Stand.
On Monday, Daisy�s Lemonade Stand and the Lemon Shack incurred identical costs to run their businesses.
In general, lemonade consumers prefer the lemonade at Daisy�s Lemonade Stand to the Lemonade at the Lemon Shack.
The Lemon Shack would not increase its revenues by lowering its prices.

Experts,

Isn't this question ill-framed and vague.

Clearly D is a good answer choice

It's fair to assume that since customers prefer Daisy over Shack, Daisy would sell more cups.
And since Daisy sells at 20cents & Shack at 30cents, we need to show that daisy sold more to make the revenue equal.


Choice C can also be substantiated but is weaker as the costs being the same, and selling the same number of cups, Shack > Daisy.

M thirsty now.

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