imhimanshujaggi Wrote:Brand X designs and buils custom sneakers, one sneaker at a time. It redently announced plans to sell "The Gold Standard", a sneaker that will cost five times more to manufacture than any other sneaker that has been ever been created.
Which of the following,if it occurred, would cast the most serious doubt on the claim that the The Gold Standard will be profitable?
a) The endorsement of the The Gold Standard by a popular Celebrity.
b) The publication of a report indicating that all previous sneaker lines launched by Brand X have been profitable.
c) A significant increase in the cost of the canvas used to construct the The Gold Standard
d) The introduction of the another new sneaker line by a rival manufacturer.
e) An announcement by Brand X that the Gold Standard will be marketed as an exclusive offering, available only in limited quantities.
My question is-
I know that weaken questions must have Premise as an answer i.e it should provide new information. So, in option C, isn't it true that it is not providing any new information. e.g if a company is saying that its product will cost 5 times more to manufacture, then it must have taken in consideration all other costs be it material costs, labor costs, and in that case canvas costs as well etc..
So, how C weakens the choice. Please explain.
Thanks
I see your confusion! It's very important to read everything carefully. Please note that none of these have already happened; these are possibilities that *could* happen. We can tell that none of them have happened by the wording in the question, "if it occurred", implying that none of them have yet occurred. Thus, we are trying to figure out which one, if it DID occur, would hurt the profitability the most.
I don't know if you need the rest of this, but I'll break down the question in case you do. A standard weaken question will have an answer that attacks an assumption. The best way to handle these is to deconstruct the argument this way:
Conclusion: The Gold Standard will be profitable
WHY?
Premise: (This argument is unusual in that a reason why the Gold Standard will be profitable is not given.)
Assumption: Because we have no facts on which to base the conclusion, we're going to have to make some assumptions. The GMAT does like to use the concept of Profit = Revenue - Cost. Thus, if the Gold Standard is going to be profitable its revenue must exceed its cost.
To weaken the argument let's attack the assumption that there will be more revenue than cost. None of the answers cast doubt on the amount of revenue to be gained, but answer choice C indicates the costs will be substantially higher than originally thought. Thus, C casts the most doubt on the idea that the sneaker will be profitable.