Dairy farmers in the United States have been paying higher

Question

Dairy farmers in the United States have been paying higher prices each year for essential components of production, such as feed for the cattle, fuel for farm equipment, and electricity for lights and machinery. At the same time, the amount the farmer receives for the milk, while fluctuating at times, is essentially the same as it was five years ago when the components of production were much less expensive. Many dairy farmers were just able to make a profit five years ago.

The statements above, if true, most strongly support which of the following conclusions?

A)Unless they have found other ways to cut expenses, some dairy farmers are no longer making a profit.
B)Consumption of milk, cheese, and other dairy products has dropped over the past five years.
C)The price of feed for cattle has risen because of the increased cost of fuel used to power the equipment needed to grow the feed.
D)International supplies of milk have increased, causing the price that U.S. dairy farmers are paid for their milk to stay low, despite increased costs of production.
E)The price paid by the consumer for milk, cheese, and ice cream has not changed over the past five years.

Please explain why not  E?

Marcab · Accepted Answer

Hi Vishu.
In the last line of the stimulus, the author punches by saying that "Even 5 years ago, the farmers were JUST able to make some profit". 
Moreover, we should not forget that the price of the equipments have been increasing each year. So its quite clear that when 5 years ago, the farmers were in such condition then today, given the fact that prices of milk products have remained the same, farmers would only have two choices: either find some way to cut expenses on machinery OR work without making the profit.
A says the same.

E is not the answer because:
i) in the stimulus it has been said that the farmers have been receiving the same amount for milk for past 5 years. So it restates the fact.
ii) you can't say anything about cheese and icecream. May be the ice-cream campanies have increased their profit margin.

A is indeed the correct choice.

mbaiseasy · Answer

A)Unless they have found other ways to cut expenses, some dairy farmers are no longer making a profit.
 The stimulus said that "many dairy farmers were just able to make profit 5 yrs ago" which means some are no longer making profit. This is a contender.

B)Consumption of milk, cheese, and other dairy products has dropped over the past five years.
 Consumption of dairy products has not been tackled here. In fact, it says that the amount received for milk is the same. The revenue is the same

C)The price of feed for cattle has risen because of the increased cost of fuel used to power the equipment needed to grow the feed.
 This is too much to assume. The stimulus mentioned each as separate reasons for the increase in cos but no relationship was mentioned.

D)International supplies of milk have increased, causing the price that U.S. dairy farmers are paid for their milk to stay low, despite increased costs of production.
 international supplies of milk is out of scope.

E)The price paid by the consumer for milk, cheese, and ice cream has not changed over the past five years.
 The amount received is the same but we cannot assume about the unit price.

Answer : A

rajathpanta · Answer

Time taken:1:34s
Strategy- eliminatation method.
Most of the ans chocies are out of scope except A.

An inference must be true and not 'may be true'

Only option A withstands this test.

greatps24 · Answer

Dairy farmers in the United States have been paying higher prices each year for essential components of production, such as feed for the cattle, fuel for farm equipment, and electricity for lights and machinery. At the same time, the amount the farmer receives for the milk, while fluctuating at times, is essentially the same as it was five years ago when the components of production were much less expensive. Many dairy farmers were just able to make a profit five years ago.

The statements above, if true, most strongly support which of the following conclusions?

A)Unless they have found other ways to cut expenses, some dairy farmers are no longer making a profit.

correct

B)Consumption of milk, cheese, and other dairy products has dropped over the past five years.

incorrect - consumption of dairy products is irrelevant

C)The price of feed for cattle has risen because of the increased cost of fuel used to power the equipment needed to grow the feed.

incorrect - it gives a reason why price for cattle feed risen?

D)International supplies of milk have increased, causing the price that U.S. dairy farmers are paid for their milk to stay low, despite increased costs of production.

incorrect - irrelevant

E)The price paid by the consumer for milk, cheese, and ice cream has not changed over the past five years.

incorrect - it strengthens the statement

Nevernevergiveup · Answer

Official Explanation:

Correct Answer: A

The correct answer will be the inference or conclusion that is most supported by the stimulus. The incorrect answers will usually go beyond the scope of information provided in the stimulus. Choice A is the correct answer because it must be true that some dairy farmers will not make a profit, given the increased costs of production without corresponding increases in the price of milk, unless those farmers are able to cut costs elsewhere. Choice B could be false; the fact that the price of milk has not risen may not be due to decreased demand as B implies, but may instead be due to increased supplies of milk. Choice C offers an explanation for the increased cost of feed, but this is beyond the scope of the passage and is not supported. Choice D is the counterpoint to Choice B, focusing on increased supplies instead of decreased demand as the reason for the stagnant milk prices. This is beyond the scope of the information provided. Choice E does not seek to explain the reason why the price of milk is unchanged, but rather seeks to draw a consequence from this fact. Milk is only one of the components of the production of dairy products and the price of milk does not translate directly to the price of consumer dairy products.

aragonn · Answer

nightblade354  - between these two choices, though i dont like both of them, i have to eliminate one, i eliminated A. Here is my reasoning, Though I would not loose my sleep over it but Can you help to give a nudge.

A)Unless they have found other ways to cut expenses, some dairy farmers are no longer making a profit.
- Let say initially their profit was 1$(5 yrs before) now their profit is 1 cent. I dont know that they still make profit or not. May be no profit no loss. even if we take last line of this abstract - Many dairy farmers were just able to make a profit five years ago - I am not sure what my contention should be from the word 'just'. I am skeptical to call it a profit/no profit situation. with this info i can't.

C)The price of feed for cattle has risen because of the increased cost of fuel used to power the equipment needed to grow the feed. - well for sure some part of price has increased cause of this. also choice is not saying that price increased only cause of that.

nightblade354 · Answer

aragonn ,

(C) cannot be the choice because this is an inference question. Yes, we are told that the cost has gone up, but it is up to the imagination why it has done so. For example, what if the farm had little rain? What if there was a fire that burned 90% of the crop. Using these examples, fuel had nothing to do with the cost increasing. We have to remember that for inference the answer has to be given. We can't make assumptions. It has to be 100% stated or implied through direct cause.

My only gripe with (A), as with this question as a whole, is that the question says "many farmers" and not "most farmers". Many = some = 1 - all. So we cannot say 100% for sure if some farmers would need to raise prices unless we knew for certain that a majority were not breaking even five years ago. Beyond this, (A) is definitely the answer. Costs go up but product output stays the same. You have to the increase price otherwise you lose money if you were just breaking even 5 years ago.

aragonn · Answer

I agree - A seems a better choice then C, still I am skeptic about it. thanks a ton for your help.

Prasannathawait · Answer

A)Unless they have found other ways to cut expenses, some dairy farmers are no longer making a profit.----- -This statement correctly says that the farmers had to reduce the expenses in other categories to make a profit. This has to be true.

B)Consumption of milk, cheese, and other dairy products has dropped over the past five years.
C)The price of feed for cattle has risen because of the increased cost of fuel used to power the equipment needed to grow the feed.
D)International supplies of milk have increased, causing the price that U.S. dairy farmers are paid for their milk to stay low, despite increased costs of production.
E)The price paid by the consumer for milk, cheese, and ice cream has not changed over the past five years.

budhni · Answer

from E we can not conclude that even if there is no change in the price, the farmers can make profit , may be very small, or not. Five years ago, the farmers were just able to make profit. that means with given facts, they are able to make now , if they do not change their strategy.. Using POE, BCDE are out. no information about consumption, no cause and effect is mention, no international supplies mentioned. Hence A. Moreover close analysis of option A justifies A as conclusion.

budhni · Answer

then in that case we can definitely say some =1 needs to cut expense to get profit.

winterschool · Answer

Dairy farmers in the United States have been paying higher prices each year for essential components of production, such as feed for the cattle, fuel for farm equipment, and electricity for lights and machinery. At the same time, the amount the farmer receives for the milk, while fluctuating at times, is essentially the same as it was five years ago when the components of production were much less expensive. Many dairy farmers were just able to make a profit five years ago.

The statements above, if true, most strongly support which of the following conclusions?

A)Unless they have found other ways to cut expenses, some dairy farmers are no longer making a profit.

correct

B)Consumption of milk, cheese, and other dairy products has dropped over the past five years.

incorrect  - consumption of dairy products is irrelevant

C)The price of feed for cattle has risen because of the increased cost of fuel used to power the equipment needed to grow the feed.

incorrect  - it gives a reason why price for cattle feed risen?

D)International supplies of milk have increased, causing the price that U.S. dairy farmers are paid for their milk to stay low, despite increased costs of production.

incorrect  - irrelevant

E)The price paid by the consumer for milk, cheese, and ice cream has not changed over the past five years.

incorrect  - it strengthens the statement

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Dairy farmers in the United States have been paying higher

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