Critical Reasoning

In 2003, the Making Hits Record Company spent 40% of its total budget on the production of ten albums, 30% of its budget on the marketing of these albums, and the remainder of its budget on overhead costs. In the same year,the Song Factory Record Company spent 20% of its total budget on the production of 10 albums and 60% of itsbudget on the marketing of these albums. Making Hits sold a total of 800,000 copies of the ten records it producedin 2003, while the Song Factory sold a total of 1,600,000 copies of the ten records it produced in 2003.

Assuming each company met its budget, which of the following conclusions is best supported by the information given above?

"¢The amount of money spent on marketing is directly related to the number of copies sold.
"¢Making Hits spent more money on the production of its albums in 2003 than did the Song Factory.
"¢Song Factory's total revenue from the sale of albums produced in 2003 was higher than that of Making Hits.
"¢In 2003, Making Hits spent a larger percentage of its budget on overhead costs than did the Song Factory.
"¢The Song Factory sold more copies of its 2003 albums than Making Hits did because the Song Factory spent ahigher percentage of its budget on the marketing of its albums

Hi,
Making Hits Record Company spent 30% of its budget on overhead costs.
Song Factory Record Company has only 20% of its budget left for its overhead costs and any other expenses. So,percentage of its budget spent on overhead costs can be at most 20%.

Hence, D

very tricky answer choices.
for me, D sounds ok.
Others are not properly backed up by the argument...

Argument didn't mention about the overhead costs of SFRC. So, remaining 20% accounts for overhead costs?
Confused

sanabk wrote:Argument didn't mention about the overhead costs of SFRC. So, remaining 20% accounts for overhead costs?
Confused

Well it doesn't really matter what the breakdown of the extra costs were for SFRC. We already know that MHRC spent 30% of its budget on overhead costs. It's impossible for SFRC to exceed this proportion since 80% of their budget is already accounted for.

Thanks Bradenm2!!!