Passage:
- Oil prices ever increasing -> fuel-efficiency is the primary concern of most car buyers (note small details included in each sentence such as "primary" and "most" - could be important when going through the answer choices)
- Companies have entered the fuel-efficient car market due to increased demand -> fierce competition
- Toyota and GM launched their latest fuel-efficient cars on the same day
Paradox:
- GM's car fared much better on fuel-efficiency, but the its market share has remained low compared to that of Toyota's car
We want to find an answer choice that will explain why it might be that GM's car is more fuel-efficient, yet does not control as much market share as Toyota's car
Answer choices:
Bunuel wrote:
(A) Except higher fuel efficiency, the car from General Motors does not offer any other advantage over the car from Toyota.
This does not say that Toyota's car HAS advantages over GM's car. It could be the case that on every aspect aside from fuel-efficiency, GM and Toyota are exactly the same. This would imply that GM's car SHOULD gain market share over Toyota's. Since this answer choice does not say that except for its higher fuel-efficiency, GM's car has DISADVANTAGES compared to Toyota's car, we cannot say this resolves the paradox.
Bunuel wrote:
(B) On the same day when Toyota and General Motors launched their cars, a couple of other companies also launched their cars and, while one of them sold well, the other did not.
This does not offer any information explaining the relationship between GM and Toyota. We would have to make further assumptions that are not supported by the passage to arrive at something that makes sense here. For example, it could be the case that the car that sold well was in more direct competition with GM's car, leading to smaller market share for GM.
Bunuel wrote:
(C) With ever increasing range of products to choose from, consumers now rely much more on the brand name of a company than the promised features and, unlike General Motors, Toyota has been a known name in fuel efficient car industry.
This looks good. This answer choice states that consumers rely on brand name rather than promised features. This directly explains why GM's car, with its better fuel-efficiency, has lower market share compared to Toyota's car. Consumers do not care as much about that better fuel-efficiency as they care about brand name, and from the answer choice, Toyota has been a known name in the industry.
Bunuel wrote:
(D) Since the total market for fuel-efficient cars has expanded a lot in the past, even companies with low market shares have made profits.
This does not explain the paradox. This simply states that the industry is profitable even for smaller players with low market shares. This does not offer anything to explain why GM's car has less market share than Toyota's.
Bunuel wrote:
(E) Even though General Motors can service all the existing demand, its production capacity is much lower than the production capacity of Toyota.
This could imply that GM's car should have more market share. If it can service all existing demand, then currently, lower production capacity should not be affecting its market share. This does not explain the paradox that is currently present.
(C) is correct