D is wrong for following reason.
If the price of prescription drugs did not change how would prescribing generic drug increase the per capita expenditure? actually it will decrease significantly because these are generally cheaper, but one must not bring in this generic and premium concept here, but the point is it will not increase so the statement does nothing.
A says that manufacturer did not raise prices of existing drugs as prohibited by law but instead came up with different drugs which replaced existing for which no law existed now since argument says per capita expenditure increase (take that as a must be true conclusion) these drugs were expensive then existing ones.
remember in these kind of question we do not have to look for 100% likely even 5% likelihood is enough for the answer to be correct. GMAC is awesome in coming up with these kinds of question.
For several years, per capita expenditure on prescription drugs in Voronia rose by fifteen percent or more annually. In order to curb these dramatic increases, the ministry of health prohibited drug manufacturers from raising any of their products’ prices. Even though use of prescription drugs did not expand after this price freeze, per capita expenditure for prescription drugs continued to increase by a substantial percentage each year.
Which of the following, if true, most helps to explain why the ministry’s action did not achieve its goal?
A. After price increases were prohibited, drug manufacturers concentrated on producing new medications to replace existing products
B. The population of Voronia rose steadily throughout the period
C. Improvements in manufacturing processes enable drug manufacturers to maintain high profit levels on drugs despite the price freeze.
D. In addition to imposing a price freeze, the government encouraged doctors to prescribe generic versions of common drugs instead of the more expensive brand-name versions
E. After price increases were prohibited, some foreign manufacturers of expensive drugs ceased marketing them in Voronia.
I cannot get my head round the reasonings of the OA. No matter how I look at it, D seems the best answer. If D is true, wouldn’t per capita expenditure of drugs increase?
Please Help with Kudos, if you like my post.