QUESTION TEXT: For a ten-month period, the total monthly…
QUESTION TYPE: Must be False
- New car sales in Calistan were constant over a ten month period.
- Marvel’s monthly sales of new cars doubled over this period and Marvel’s market share of new car sales doubled.
- At the end of the ten month period Calistan imposed emissions controls.
- In the following three months Marvel’s market share declined greatly even though its sales remained constant.
ANALYSIS: Clearly the new car market grew. That’s the only way to explain Marvel’s declining share when its sales stayed the same.
- CORRECT. This can’t be true. At least some car companies had to increase their sales. The overall market grew.
- This is possible since it happened before Marvel’s decline of market share.
- This is possible. Maybe Marvel cars are actually quite environmentally friendly and it was some other factor that caused Marvel’s decline.
- This is possible in the long run. We have no idea whether more or less cars will be sold.
- This is possible. A company can increase its profit even if its market share declines.
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