[Gmat Aspirants] Good CR question 1
Nagendra Pratap
Hello Everyone,
I want to discuss this question with you all. Kindly pour your thoughts. Also explain your approaches.
Certain items—those with that hard-to-define quality called exclusivity—have the odd property, when they become available for sale, of selling rapidly even though they are extremely expensive. In fact, trying to sell such an item fast by asking too low a price is a serious error, since it calls into question the very thing—exclusivity—that is supposed to be the item’s chief appeal. Therefore, given that a price that will prove to be right is virtually impossible for the seller to gauge in advance, the seller should make sure that any error in the initial asking price is in the direction of setting the price too high.
The argument recommends a certain pricing strategy on the grounds that
(A) this strategy lacks a counterproductive feature of the rejected alternative
(B) this strategy has all of advantages of the rejected alternative, but fewer of its disadvantages
(C) experience has proven this strategy to be superior, even though the reasons for this superiority elude analysis
(D) this strategy does not rely on prospective buyers estimates of value.
(E) the error associated with this strategy, unlike the error associated with the rejected alternative, is likely to go unnoticed
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With Regards
Nagendra Pratap
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himanshu yadav
With Best Regards
Himanshu Yadav
Mob:9911966833
"Challenges are high, the Dreams are New,The world out there is waiting for you,Dare to dream, Dare to try, No goal is too distant, No star is to high Just Get Going"
hj
The error being talked about is the incorrect pricing, which in turn would be Higher than what it should command for whatever purpose it serves.
But that error would be 'masked' by the Exclusivity factor.
nitin singhal
suggested pricing strategy : extremely high price, preserve exclusivity, sell rapidly
rejected pricing strategy : low price, call off exclusivity => will not sell fast as exclusivity is lost
