this_time_i_will wrote:i think D.

SmarpanGamt wrote:Surveys show that every year only 10 percent of cigarette smokers switch brands. Yet the manufacturers have been spending an amount equal to 10 percent of their gross receipts on cigarette promotion in magazines. It follows from these figures that inducing cigarette smokers to switch brands did not pay, and that cigarette companies would have been no worse off economically if they had dropped their advertising.
19. Of the following, the best criticism of the conclusion that inducing cigarette smokers to switch brands did not pay is that the conclusion is based on
(A) computing advertising costs as a percentage of gross receipts, not of overall costs
(B) past patterns of smoking and may not carry over to the future
(C) the assumption that each smoker is loyal to a single brand of cigarettes at any one time
(D) the assumption that each manufacturer produces only one brand of cigarettes
(E) figures for the cigarette industry as a whole and may not hold for a particular company

SmarpanGamt wrote:Surveys show that every year only 10 percent of cigarette smokers switch brands. Yet the manufacturers have been spending an amount equal to 10 percent of their gross receipts on cigarette promotion in magazines. It follows from these figures that inducing cigarette smokers to switch brands did not pay, and that cigarette companies would have been no worse off economically if they had dropped their advertising.
19. Of the following, the best criticism of the conclusion that inducing cigarette smokers to switch brands did not pay is that the conclusion is based on
(A) computing advertising costs as a percentage of gross receipts, not of overall costs
(B) past patterns of smoking and may not carry over to the future
(C) the assumption that each smoker is loyal to a single brand of cigarettes at any one time
(D) the assumption that each manufacturer produces only one brand of cigarettes
(E) figures for the cigarette industry as a whole and may not hold for a particular company

FightWithGMAT wrote:

SmarpanGamt wrote:Surveys show that every year only 10 percent of cigarette smokers switch brands. Yet the manufacturers have been spending an amount equal to 10 percent of their gross receipts on cigarette promotion in magazines. It follows from these figures that inducing cigarette smokers to switch brands did not pay, and that cigarette companies would have been no worse off economically if they had dropped their advertising.
19. Of the following, the best criticism of the conclusion that inducing cigarette smokers to switch brands did not pay is that the conclusion is based on
(A) computing advertising costs as a percentage of gross receipts, not of overall costs
(B) past patterns of smoking and may not carry over to the future
(C) the assumption that each smoker is loyal to a single brand of cigarettes at any one time
(D) the assumption that each manufacturer produces only one brand of cigarettes
(E) figures for the cigarette industry as a whole and may not hold for a particular company

tricky one!

IMO A

Is 10% of gross income of the entire industry worth spending on advertisements and promotions...............may be yes may be no...........depends on whether this 10% is actually is a big portion of the total cost incurred or not

If the industry spends 50% of the gross income as a overall cost to company, this 10% will be a small portions when compared to the overall costs.

Please give inputs on this analysis.