Understanding the Passage
To protect certain fledgling industries, the government of country Z banned imports of the types of products those industries were starting to make.The govt. of Z did something to protect certain fledgling industries.
What did it do?
Banned imports of the types of products those industries were starting to make.
(How would doing so protect those industries?
By banning those imports, you have eliminated foreign competition for these companies.
Thus, domestic customers will have to buy from these fledgling domestic industries. As a result, these fledgling industries will have more customers than they would have had if the imports had not been banned.)
As a direct result, the cost of those products to the buyers, several export-dependent industries in Z, went up, sharply limiting the ability of those industries to compete effectively in their export markets.As a result of this ban, the cost of those products to the buyers increased.
Who were these buyers?
Several export-dependent industries
This cost increase severely restricted these export-dependent industries’ ability to compete effectively in their export markets.
(How did this cost increase restrict these industries’ ability to compete?
If the input cost increases, a company will perhaps increase the output cost. As a result, its products will perhaps become more expensive than its competitors’ products. Thus, its ability to compete will go down.)
Understanding the Question Stem
Which of the following conclusions about country Z's adversely affected export-dependent industries is best supported by the passage?
The question asks us to find from the option a conclusion about Z’s adversely affected export-dependent industries that is best supported by the passage.
In other words, we’re looking for a conclusion best supported by the passage. The conclusion has to be about Z’s adversely affected export-dependent industries.
Thus, we’ll take the statements in the passage as facts and evaluate which option can be concluded from those statements.
The Evaluation
(A) Profit margins in those industries were not high enough to absorb the rise in costs mentioned above.Correct. It’s quite easy to reject this option by saying that the passage doesn’t give us any information about the profit margins of these industries.
Many people look at just one or two words in an option and reject the option saying, “The passage nowhere talks about these things. Out!”
As the current case suggests, this way of rejecting options is flawed. You may be following this strategy in many cases and getting by. If so, it may be hard for you to accept that this way of reasoning is flawed.
You’re perhaps wondering, “If this way is flawed, why does it work most of the time?”
This way of reasoning works most of the time because 80% of the options in a CR question are incorrect (i.e., 4 out of 5 options are incorrect). Thus, even if you have flawed reasoning to reject the options, you will get by a lot of time.
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Now, let’s try to understand why this option is correct.
You may realize that this option is a negative statement; it says that something is not the case.
It says that profit margins were not high enough to absorb the rise in costs mentioned above.
To reject an option in an inference question, you need to be sure that the negation of the option is possible.
Only then can you say that this option cannot be concluded or inferred (because the negation is also possible)
What would be the negation of this statement?
The negation will be:
Profit margins in those industries were high enough to absorb the rise in costs mentioned above.
Is the above case possible?
Is it possible that profit margins in those industries were high enough to absorb the rise in costs mentioned above?
No. It’s not possible, since we’re given that the increase in costs
sharply limited the ability of these industries to compete effectively.
If the profit margins were high enough to absorb the rise in costs, the increase in costs will not have
sharply limited the ability of these industries to compete effectively.
Since the opposite of this option is not possible, we can conclude this option from the given passage.
(B) Those industries had to contend with the fact that other countries banned imports from country Z.Incorrect. I sense that some people mark this option thinking, “If country Z bans some imports from other countries, isn’t it logical to expect that other countries would also ban imports from country Z?”
I’ll agree that there is a chance that other countries would reciprocate. However, can we conclude this from the passage?
The answer is No. To conclude, we need not only indication but very strong support.
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I believe that some people mark this option believing that it supports the final statement in the passage. If so, these people have misread the question - the question asks to find an option that is supported by the passage, NOT an option that supports the passage.
(C) Those industries succeeded in expanding the domestic market for their products.Incorrect. There’s absolutely no indication that these industries expanded the domestic market for their products.
Of course, given that their ability to compete in the export markets is diminished, there is a chance that these industries would have wanted to expand in the domestic market.
However, we cannot conclude even the idea that these industries tried to expand the domestic market for their products. It is entirely possible that they continued to focus on the export markets.
(D) Steps to offset rising materials costs by decreasing labor costs were taken in those industries.Incorrect. There’s absolutely no indication in the passage that such steps were taken. (If you marked option D, my hunch is that you had forgotten that you were solving an inference question)
Perhaps, no steps to offset rising material costs were taken.
Or, even if such steps were taken, the steps might not have included decreasing labor costs.
(E) Those industries started to move into export markets that they had previously judged unprofitable.Incorrect. There’s absolutely no indication in the passage that these industries moved into any new export markets. Perhaps, they continued to focus on the existing markets - by improving their products or distribution, by changing their brand image, or by some cost-cutting.
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Updated on: 31 Jan 2024, 02:49
35%
(medium)
25%
(02:25)
wrong 
