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GMAT PREP Tricky cr question...a manufacturer of workstation
CONFUSED
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A manufacturer of workstations for computer-aided design seeks to increase sales to its most important corporate customers. Its strategy is to publish very low list prices for workstations in order to generate interest among the buyers for those corporations.
Which of the following, if characteristic of the marketplace, would tend to cause the manufacture’s strategy to fail?
A. The proposed list prices would seem low to a typical buyer for the manufacturer’s most important corporate customers.
B. The capabilities of workstations suitable for given jobs are not significantly different among various manufactures.
C. The manufacturer’s most important corporate customers employ as buyers persons who are very knowledgeable about prices for workstations for customer-aided design.
D. customers differ significantly in the percentage of resources they can devote to computer workstations.
E. Buyers for corporations that purchase workstations for computer-aided design receive bonuses for negotiating large discounts from the list price.

ok OA is E

but I think that D is correct too. if customers can't afford to purchase workstations, then it doesn't matter how low the prices are.

please help guys!
Anon
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E - if prices are already too low , the buyers will not buy from the manufacturer as they will not get a bonus .

OA ?
Pathik
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D. customers differ significantly in the percentage of resources they can devote to computer workstations.

If anything D strengthens the argument by saying that customers can more value for their resources.
Re: GMAT PREP Tricky cr question...a manufacturer of worksta
Ron Purewal
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Joined: 08 Oct 2007
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CONFUSED wrote:

but I think that D is correct too. if customers can't afford to purchase workstations, then it doesn't matter how low the prices are.


i'll assume from your wording ('...is correct too') that you already understand the validity of choice e; if you don't, please post again and we can explain it.

you're reading way too much into choice d, which says only this: the customers differ significantly in how much they can spend on workstations.
you seem to be inferring from this that there are many, many customers who can't afford to purchase workstations at all, an inference that is completely unjustified.
analogy: if an article told you that bidders made 'widely varying bids' for some piece of art at an art auction, would you assume that many bidders made a bid of zero dollars? no, of course you wouldn't.

if anything, as stated in a post above, this choice strengthens the argument somewhat, because it indicates the presence of at least some price-sensitive consumers who would welcome the new plan.

--

as a final shot in the head to the complaint about consumers who can't afford workstations at all:
even if there are zillions of such customers, the argument still isn't weakened at all. here's why: those consumers wouldn't even be in the marketplace in the first place!
think about what it means for the manufacturer's strategy to fail: it means that customers who might otherwise purchase the product decide not to purchase it.
if you know customer X can't, or won't, purchase your product no matter what, and still can't or won't under your new strategy, that is not a failure.
GMAT PREP Tricky cr question...a manufacturer of workstation
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