The value of a product is determined by the ratio of its : GMAT Critical Reasoning (CR)
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The value of a product is determined by the ratio of its

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The value of a product is determined by the ratio of its [#permalink]

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17 Aug 2006, 03:37
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The value of a product is determined by the ratio of its quality to its price. The higher the value of a product, the better will be its competitive position. Therefore, either increasing the quality or lowering the price of a given product will increase the likelihood that consumer will select that product rather than a competing one.

Which of the following, if true, would most strengthen the conclusion drawn above?

(A) It is possible to increase both the quality and the price of a product without changing its competitive position.
(B) For certain segments of the population of consumers, higher-priced brands of some product lines are preferred to the lower-priced brands.
(C) Competing products often try to appeal to different segments of the population of consumers.
(D) The competitive position of a product can be affected by such factors as advertising and brand loyalty.
(E) Consumersâ€™ perceptions of the quality of a product are based on the actual quality of the product.
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Re: CR - Value of a product [#permalink]

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17 Aug 2006, 04:25
sperinko wrote:
The value of a product is determined by the ratio of its quality to its price. The higher the value of a product, the better will be its competitive position. Therefore, either increasing the quality or lowering the price of a given product will increase the likelihood that consumer will select that product rather than a competing one.

Which of the following, if true, would most strengthen the conclusion drawn above?

(A) It is possible to increase both the quality and the price of a product without changing its competitive position. [b]"Classic 180" actually weakens the conclusion[/b
(B) For certain segments of the population of consumers, higher-priced brands of some product lines are preferred to the lower-priced brands. The passage is referring to consumers in general.
(C) Competing products often try to appeal to different segments of the population of consumers. True-Keep
(D) The competitive position of a product can be affected by such factors as advertising and brand loyalty. Out of scope.
(E) Consumersâ€™ perceptions of the quality of a product are based on the actual quality of the product. If so, then consumers can distinguish between the better brands (or simply read consumer reports) -Keep

(E) over C here because if the consumer is making an informed decision then the central premise of the argument is strengthened.
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Re: CR - Value of a product [#permalink]

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17 Aug 2006, 07:32
GMATT73 wrote:
sperinko wrote:
The value of a product is determined by the ratio of its quality to its price. The higher the value of a product, the better will be its competitive position. Therefore, either increasing the quality or lowering the price of a given product will increase the likelihood that consumer will select that product rather than a competing one.

Which of the following, if true, would most strengthen the conclusion drawn above?

(A) It is possible to increase both the quality and the price of a product without changing its competitive position. [b]"Classic 180" actually weakens the conclusion[/b
(B) For certain segments of the population of consumers, higher-priced brands of some product lines are preferred to the lower-priced brands. The passage is referring to consumers in general.
(C) Competing products often try to appeal to different segments of the population of consumers. True-Keep
(D) The competitive position of a product can be affected by such factors as advertising and brand loyalty. Out of scope.
(E) Consumersâ€™ perceptions of the quality of a product are based on the actual quality of the product. If so, then consumers can distinguish between the better brands (or simply read consumer reports) -Keep

(E) over C here because if the consumer is making an informed decision then the central premise of the argument is strengthened.

Agreed. You are too good MATT.
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17 Aug 2006, 07:44
If consumers perception is NOT based on actual quality, then the premise of the argument that the competitive value of a product can be increased by "increasing the quality" will be killed;

Therefore if customers perception is based on actual quality then the central premise is strengthened.

MATT - as far as A is concerned i think it's just a plain statment of truth - it doesn't weaken or strengthen the argument; but what it says is true.. both quality and price can be increased without changing the value of the commodity (higher quality, but higher price as well; so for the customer it may not be true value because the product may simply be too expensive)

WHat do you think?
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17 Aug 2006, 10:37
Vote E
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17 Aug 2006, 12:29
Both C and E sound equally stong -

(C) Competing products often try to appeal to different segments of the population of consumers. - So if the price of a product is lowered it will target a population in lower income bracket.
..............
(E) Consumersâ€™ perceptions of the quality of a product are based on the actual quality of the product. - If the quality is increased, consumers will acknowledge it and this will certainly have a competitive advantage.

Would go for C.
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17 Aug 2006, 23:53
Straight E.

Supports the conclusion that increasing quality can help to make the product more competetive.
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18 Aug 2006, 00:35
What if a product of low quality has its price lowered.Aren't we assuming that people would still buy it.(read (E))

Doesent (A) show that the competition depends on both factors.
It implies that people already know the quality of the product.Maybe due to some standard logo on the product packing,.
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18 Aug 2006, 00:44
Another popular one.... E is the answer here
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18 Aug 2006, 06:25
OA is (E).
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18 Aug 2006, 06:25
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