Surveys Show that Every Year only 10 Percent of Cigarette Smokers GMAT Critical Reasoning

Question: 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.

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

Surveys show that every year only 10 percent of cigarette smokers switch brands- is a GMAT Critical reasoning question. This particular GMAT Critical Reasoning topic has been taken from ‘GMAT Prep Plus 2021’. This particular question is inference type. For this type, the candidates need to provide logical conclusions based on evidence as given in the passage.

GMAT critical reasoning tests the logical and analytical skills of the candidates. GMAT critical reasoning requires candidates to find the strengths and weaknesses of the argument, or find the logical flaw in the argument.  One of the most helpful GMAT critical reasoning strategies is to read the question before the passage. Learn the GMAT critical reasoning question type, then read the argument with that mindset.  

Answer: E
Explanation: Let us check the given options to check which assumption fits the argument the best:

Hypothesis: every year only 10 percent of smokers switch brands.
Hypothesis: manufacturers have been spending an amount equal to 10 percent of their gross receipts on cigarette promotion in magazines.

Conclusion: inducing cigarette smokers to switch brands did not pay, and that cigarette company would have been no worse off economically if they had dropped their advertising.

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
-Option A cannot be considered a criticism. The gross receipts and other costs are not mentioned.

(B) past patterns of smoking and may not carry over to the future
-In option B it states ‘over to the future’ which refers to the future scene. But the conclusion states about the past. Hence option B is incorrect.

(C) the assumption that each smoker is loyal to a single brand of cigarettes at any one time
-In option C there is no assumption. It states multiple brands. Hence option C is incorrect.

(D) the assumption that each manufacturer produces only one brand of cigarettes
-In option D there is no assumption. It states about a manufacturer that produces multiple brands. Hence option D is incorrect.

(E) figures for the cigarette industry as a whole and may not hold for a particular company
-Option E states that the "10% people" figure seems small industry-wise. Considering there are 5 brands with each having 20 loyalists for a total of 100 smokers. So, let 10 of these 100 switch brands. There is a probability of the first having 30 loyalists. This increases 50%of the customer base. Hence there is a 10% marketing budget that would be worth it. Hence this is the criticism of the conclusion. Hence option E is correct.

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