lexis wrote:
First-time computer buyers buying PXC home computers typically buy models that cost much less and have a smaller profit margin per computer than do PXC computers bought by people replacing their computers with more powerful models. Last year PXC's profits from computer sales were substantially higher than the previous year, although about the same number of PXC computers were sold and the prices and profit margins for each computer model that PXC sells remained unchanged.
If the statements above are true, which of the following is most strongly supported by them?
(A) PXC's competitors raised the prices on their computers last year, making PXC computers more attractive to first-time computer buyers.
(B) The number of people buying PXC computers who also bought PXC computer-related products, such as printers, was larger last year than the previous year.
(C) Among computer buyers who bought a PXC computer to replace their existing computer, the proportion who were replacing a computer made by a competitor of PXC was greater last year than the previous year.
(D) The proportion of PXC computers bought by first-time computer buyers was smaller last year than the previous year.
(E) PXC's production costs for its computers were lower last year than they had been the previous year.
First we'll look at the data of the statements made in the argument. The paragraph states that first-time computer buyers select models with a lower profit margin, and last year the profit was much higher than the previous year. We should look for any option that mentions consumers buying higher profit margin models to support why last year profits were much higher.
A, and C are out of scope since they mention competitors. We'll eliminate these options. We're looking for something that supports what is in the statements.
B is tempting, but the statements don't mention anything about the other products. Eliminate B.
E is also tempting, but again nothing is mentioned in the statements about lowering production costs to increase profit margin.
D remains and addresses the shift in consumer purchasing habits from "first-time" to higher profit models.