Sales at a local sandwich shop have been declining steadily

[LinaFahmi]

Sales at a local sandwich shop have been declining steadily since a health food restaurant opened its doors for business on the same block three months ago. The owner of the sandwich shop concludes that the best way to raise sales back to prior levels is to offer special sandwich prices that compete with the low prices at the health food restaurant.

Which of the following assumptions helps to justify the owner’s conclusion?

A) Local consumers prefer the food at the sandwich shop to the food at the health food restaurant.
B) Sales at the sandwich shop reached an all-time high six months ago.
C) The sandwich shop’s prices are currently higher than those of a similar shop located in a neighboring town.
D) The sandwich shop does not currently offer any healthful food items.
E) The health food restaurant is running its special prices as a temporary promotion and will be raising its prices at the end of the year.

Correct answer: (A)

I eliminated A because my thought would be that if local consumers prefer the food at the sandwich shop, why go to the health food restaurant?

My answer was E because the sandwich shop wants to compete on price with the health food restaurant.

Can someone please explain what error I made?

[murilo]

IMO when the sandwich shop owner low his price to become competitive with the health food restaurant, why the consumers will choose the sandwich shop? since now the price its not a issue they will choose it because they prefer it not because it cheaper than others

[jnelson0612]

IMO when the sandwich shop owner low his price to become competitive with the health food restaurant, why the consumers will choose the sandwich shop? since now the price its not a issue they will choose it because they prefer it not because it cheaper than others

Yes. The owner is assuming that the only reason that he has lost business to the health food restaurant is that the health food restaurant's prices are lower. Thus, if he matches the prices he will get back the business.

That is a big assumption! What if people actually like the food at the health food restaurant more than they like the food at the sandwich shop? In that case, just lowering the prices of the sandwiches to the price of the food at the health food shop won't do anything. We have to assume that overall people actually like the food at the sandwich shop more than the food at the health food restaurant, and the only thing driving them to eat at the health food restaurant is the lower price.

[JbhB682]

Hi Experts - is this question a strengthen question or an assumption question ?

i have read on other forums - that this is a strengthen question

[JbhB682]

I personally think (A) is a strengthener and not a necessary assumption

Local consumers DONT have to **Prefer" food at the sandwich shop.

For example -

(A-variant) Local consumers *equally* prefer the food at the sandwich shop to the food at the health food restaurant.

If local consumers LIKE BOTH (sandwich and healthy food) - equally, then the conclusion stands.

[Whit Garner]

Hi jbhB682 -

Great question, and thank you for your patience! The forums were down for quite a while and we weren't able to post replies!

For your question, I'd still argue that choice A is a necessary assumption rather than just a strengthener. Note that the conclusion has two pieces: raising sales back to prior levels (not just increasing them somewhat) and prices that compete with (not that are lower than) the health food store. In other words, the conclusion states that if prices were the same at both stores, consumers would make the same decisions they made before the health food store even opened - the health food store would take zero business from the sandwich shop. If consumers preferred the two even equally, the health food store would still cut into the sandwich shop's sales at least somewhat if the prices were just competitive. It needs to be the case that the only reason why people are choosing the health food store is because of price.

That said, I think a better variant of this answer choice would be the following:

(A) Local consumers do not prefer the food at the health food restaurant to the food at the sandwich shop.

Hope this helps!

Whit