local shop vs new restaurant- Assumption

Question

Sales at a local sandwich shop have been declining steadily since a health food restaurant opened its doors for business on the same block three months ago. The owner of the sandwich shop concludes that the best way to raise sales back to prior levels is to offer special sandwich prices that compete with the low prices at the health food restaurant.

Which of the following assumptions helps to justify the owner’s conclusion?

A) Local consumers prefer the food at the sandwich shop to the food at the health food restaurant.

B) Sales at the sandwich shop reached an all-time high six months ago.

C) The sandwich shop’s prices are currently higher than those of a similar shop located in a neighboring town.

D) The sandwich shop does not currently offer any healthful food items.

E) The health food restaurant is running its special prices as a temporary promotion and will be raising its prices at the end of the year.

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cata1yst · Answer

A.

If we can assume consumers prefer the food at the sandwich shop over the health food restaurant, then lowering the prices to or below the health food restaurant should raise sales back to prior levels.

ajay_deepak · Answer

A.
The owner thinks that the only reason others go to restaurant is the high cost of sandwiches. So the owner is assuming that everyone likes sandwiches but because of high costs don't prefer it these days.

rseeker2 · Answer

Is it A? Both the shops now have competitive prices. The reason why one should be chosen over the other would only be because of the preference for that particular food.

mehravikas · Answer

IMO - A

turbo jet · Answer

IMO : E OA please? : :roll:

Kenen750 · Answer

IMO its "A"....

som_frodo · Answer

at first I thought the answer'd be E, but then after a second thought I realized that even though E says that the special promotional offers is going on at the health food restaurant, it doesnt really mean that the local shop can raise its sales only by decreasing the price. On the other hand A has a strong point behind it as it says local consumers prefer the food at the sandwich shop (but the problem may be with the price).
SO, i think the answer is A.

turbo jet · Answer

som_frodo wrote:at first I thought the answer'd be E, but then after a second thought I realized that even though E says that the special promotional offers is going on at the health food restaurant, it doesnt really mean that the local shop can raise its sales only by decreasing the price. On the other hand A has a strong point behind it as it says local consumers prefer the food at the sandwich shop (but the problem may be with the price).
SO, i think the answer is A.

Hi Som,

I do agree with your logic. But I also feel that in Choice E , rise in price in the future indicates that sales will increase in the future when sandwich shop prices would be still lower.

More thoughts on why A is chosen over E is welcome!!

Cheers
Turbo Jet
Still

: :roll:

kanha81 · Answer

turbo jet wrote:som_frodo wrote:at first I thought the answer'd be E, but then after a second thought I realized that even though E says that the special promotional offers is going on at the health food restaurant, it doesnt really mean that the local shop can raise its sales only by decreasing the price. On the other hand A has a strong point behind it as it says local consumers prefer the food at the sandwich shop (but the problem may be with the price). SO, i think the answer is A. Hi Som, I do agree with your logic. But I also feel that in Choice E , rise in price in the future indicates that sales will increase in the future when sandwich shop prices would be still lower. More thoughts on why A is chosen over E is welcome!! Cheers Turbo Jet Still : :roll: OA is [spoiler][A][/spoiler] Basically, A strengthens the conclusion and eliminates any alternate cause.

vinaynp · Answer

turbo jet wrote:som_frodo wrote:at first I thought the answer'd be E, but then after a second thought I realized that even though E says that the special promotional offers is going on at the health food restaurant, it doesnt really mean that the local shop can raise its sales only by decreasing the price. On the other hand A has a strong point behind it as it says local consumers prefer the food at the sandwich shop (but the problem may be with the price). SO, i think the answer is A. Hi Som, I do agree with your logic. But I also feel that in Choice E , rise in price in the future indicates that sales will increase in the future when sandwich shop prices would be still lower. More thoughts on why A is chosen over E is welcome!! Cheers Turbo Jet Still : :roll: I got tricked over by E as well :roll:

schumi_gmat · Answer

Hi Som,

I do agree with your logic. But I also feel that in Choice E , rise in price in the future indicates that sales will increase in the future when sandwich shop prices would be still lower.

I we negate E, then it doe not weaken the conclusion. Infact it supports the conclusion suggesting that sales will increase.

So E is not a correct assumption

turbo jet · Answer

Thnks Schumi. Got the logic. A is the answer. E is infact weakening the conclusion Cheers TJ

siddhans · Answer

I still dont get why E is wrong? Please explain someone ....How does the negation technique work..I am not use to this negation technique and have a hard time understanding the negation technique

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