A21. The following appeared in a memo from the president of Elegant Seafoods, a chain of restaurants. “We should proceed with our plan to open a new restaurant in the busy College Plaza shopping center near Waymarsh College. Although two restaurants in that location have closed in the past two years (one a pizza parlor, the other a deli), their failure does not mean College Plaza is an unsuitable location for our restaurant. After all, the Plaza Café has been in business at that location for twenty years. Furthermore, national reports from the restaurant industry show that college students are eating out more frequently than ever. It is likely, then, that we will be very successful at that location.” 1Other restaurants' faliures do not mean Elegant Seafoods's failure. Likewise, the Plaza Cafe's success does not guarantee Elegant Seafoods' success. 2Although the students are eating out more frequently than ever, they may not choose to eat sea foods since students are a very unique consumer category characterized as people with no or little income. 3Even if Elegant Seafoods can be popular at that location, it is still too early to allege its success without a cost-benefit analysis. |