In order to save money, many consumers redeem coupons that are

Question

In order to save money, many consumers redeem coupons that are distributed by retail stores. However, in general, retail stores that distribute and accept store coupons as a way of discounting the prices on certain products charge more for their products, on average, than other retail stores charge for the same products-even after lower prices available on coupon-discounted products are factored in. This is because producing and distributing coupons usually costs a great deal. To compensate for this expense without reducing profits, retail stores must pass it on to consumers.

Which one of the following can be properly inferred from the information above?

(A) Many consumers who redeem coupons save little if any money, overall, by doing so.
(B) Retail stores that distribute coupons generally compensate for the expense of producing and distributing coupons by charging higher prices for certain products.
(C) The profits of retail stores that use coupons are not significantly lower, on average, than the profits of similar stores that do not use coupons.
(D) At least some retail stores that do not use coupons do not have expenses that they pass on to consumers.
(E) The undiscounted price charged for a good for which a retail store offers a coupon will be higher than the price charged for that same good by a retail store that does not offer a coupon for it.

Source: LSAT

parthdoshi111 · Answer

B because customers tend to believe that if this product is cheaper than other are so as well..

Sent from my ONE A2003 using  GMAT Club Forum mobile app

tejyr · Answer

I was struck with b and e.
both are very nearer to be the answers as:
(B) Retail stores that distribute coupons generally compensate for the expense of producing and distributing coupons by charging higher prices for certain products.-producing and distributing coupons usually costs a great deal. To compensate for this expense without reducing profits, retail stores must pass it on to consumers.
(E) The undiscounted price charged for a good for which a retail store offers a coupon will be higher than the price - retail stores that distribute and accept store coupons as a way of discounting the prices on certain products charge more for their products, on average, than other retail stores charge for the same products-even after lower prices available on coupon-discounted products are factored incharged for that same good by a retail store that does not offer a coupon for it.

Anyone explain how b preferred over e

codyllee · Answer

This was an excellent question and I too spent a a few seconds deciding between B and E.

Ultimately, I chose B based on the following:

(B) Retail stores that distribute coupons  generally  compensate for the expense of producing and distributing coupons by charging higher prices for certain products.
  - Referring to the original prompt, we find supporting text in the first sentence. Also, since this is an inference question, correct answers tend to favor "soft" language. 
(E) The undiscounted price charged for a good for which a retail store offers a coupon  will  be higher than the price charged for that same good by a retail store that does not offer a coupon for it.
  - Again, referring to the original prompt, there aren't any qualifying statements that can  definitively  support this claim. Plus, "will" demands this case to be true always, which we cannot infer from the passage.

SugandhaM · Answer

Hey, a little help please.
Isn't option B a repeat of what has already been mentioned in the question's paragraph? How is it an inference then?

akela · Answer

Powerscore explanation:

Must Be True. The correct answer choice is (B)

This long stimulus contains a set of facts describing the use of coupons by retail stores.

Although many consumers, to save money, redeem coupons distributed by retail stores, they may not be saving as much as they think. This is because, generally speaking, retail stores that distribute and accept store coupons as a way of discounting prices on certain products charge more for their products, on average, than other retail stores charge for the same products, even after lower prices available on coupon-discounted products are factored in. The stores price their items this way because of the great cost involved in producing and distributing coupons. The retail stores do not simply eat this cost, because doing so would reduce their profits. Instead, they pass the cost on to consumers.

The question stem indicates that this is a Must Be True question. An inference permissible from the fact set, which will be our prephrase, is that consumers who redeem coupons distributed by retail stores in order to save money may ultimately fail to save money. This would occur if the consumers also purchase other products at the store, not on sale, that are priced higher there than at other retail stores. Notice this inference is framed only as a possibility, because nothing in the stimulus states the consumers redeeming coupons actually purchase the other, higher-priced items.

Answer choice (A): This answer choice is incorrect because it is not supported by the stimulus. As stated in the prephrase, there is no support in the stimulus for the inference that the coupon shoppers in fact buy the higher-priced items as well. This choice implies that the shoppers who redeem the coupons also purchase the other items at inflated prices, resulting in little if any net savings.

Answer choice (B): This is the correct answer choice, because it is a restatement of the combination of the second, third and fourth sentences. This question provides a great example of not being overly wed to your prephrase. While the prephrase described above was in keeping with the type of inference normally tested, in this case LSAC chose not to test it. You must be prepared to abandon even a strong prephrase if it turns out the correct answer choice has gone in a different direction.

Answer choice (C): The only mention of profits in the stimulus is the motivation for the retail stores that distribute coupons to increase their prices on other items. There is no support for a comparison between the actual profits of those stores that use coupons and those stores that do not.

Answer choice (D): This choice is incorrect because the stimulus did not provide any information regarding the practices of retail stores that do not use coupons.

Answer choice (E): This is an attractive answer choice because it presents at a per-item level the practice referenced in the stimulus of compensating for the expense of using coupons by raising the prices on some items. However, this choice is incorrect because the stimulus does not identify which products the retailers using coupons mark up.

GMATNinja · Answer

SugandhaM , check out  this post .

"...sometimes, an inference can be a fairly simple restatement of something given in the passage. Sometimes, that inference is so obvious that it seems really, really stupid. But as long as the language is slightly different, it qualifies as an inference, and not something that was directly stated."

We also discuss exactly this issue in  this YouTube video .

I hope this helps!

BrentGMATPrepNow · Answer

The key to answering inference/conclusion questions is to look for the answer choice that  MUST  follow from the argument.

The passage tells us that,  in general , retail stores that distribute and accept store coupons as a way of discounting the prices on certain products charge more for their products, on average, than other retail stores charge for the same products-even after lower prices available on coupon-discounted products are factored in.

Notice that the phrase "in general" allows for the possibility that some stores may not 100% adhere to this practice. 
Since the passage does not include strong/absolute language, it's doubtful that a conclusion can have strong/absolute language.

The two most tantalizing answers choices here are B and E, and each illustrates our need to find the answer choice that  MUST  follow from the argument.

Answer choice B says Retail stores that distribute coupons   generally   compensate for the expense of producing and distributing coupons by charging higher prices for certain products.
Perfect. 
This is just a rewording of part of the passage. More importantly, the language is not strong/absolute.

Answer choice E has very strong wording. It says that the undiscounted price   WILL   be higher than the price charged for that same good by a retail store that does not offer a coupon for it.
This does not match the passage, which tells us that,  in general , retail stores behave a certain way. 
Given this strong language, we can eliminate E

Answer: B

Cheers,
Brent

KarishmaB · Answer

Many consumers redeem coupons that are distributed by retail stores. 
 On average , coupon stores charge more for same products than other stores (even after factoring in coupons)
This is done to compensate for coupon expense without reducing profits. Retail stores must pass it on to consumers.

Which one of the following can be inferred?

(A) Many consumers who redeem coupons save little if any money, overall, by doing so.

Not necessary. We don't know the overall purchase pattern of many consumers. They may be buying the cheapest from different stores.

(B) Retail stores that distribute coupons generally compensate for the expense of producing and distributing coupons by charging higher prices for certain products.

Correct. We can infer this. The stores generally compensate for coupons by charging higher prices on some products.

(C) The profits of retail stores that use coupons are not significantly lower, on average, than the profits of similar stores that do not use coupons.

The argument doesn't give enough information about overall profits of the stores.

(D) At least some retail stores that do not use coupons do not have expenses that they pass on to consumers.

Again, the argument doesn't tell us anything about whether non-coupon stores have expenses that they pass on to the consumers.

(E) The undiscounted price charged for a good for which a retail store offers a coupon will be higher than the price charged for that same good by a retail store that does not offer a coupon for it.

The argument only tells us that ON AVERAGE, the coupon stores charge more. It is not NECESSARY that the undiscounted price WILL BE higher at the coupon store.

Answer (B)

ravigupta2912 · Answer

This was a tough one. Took me 2:31.

(A) Many consumers who redeem coupons save little if any money, overall, by doing so. -- Incorrect. We don't know that. It depends on the products being brought. The retail stores may increase prices of other products (not those on which they offer coupons) which are not bought by customers who redeem coupons.

(B) Retail stores that distribute coupons generally compensate for the expense of producing and distributing coupons by charging higher prices for certain products. -- Correct. They compensate by charging a higher price for certain products.

(C) The profits of retail stores that use coupons are not significantly lower, on average, than the profits of similar stores that do not use coupons. -- Incorrect. We don't know anything about this. If the retail stores that offer coupons increase price of other price inelastic products , the overall margin could increase.

(D) At least some retail stores that do not use coupons do not have expenses that they pass on to consumers. -- Incorrect. Completely out of scope. We are not given any such info.

(E) The undiscounted price charged for a good for which a retail store offers a coupon will be higher than the price charged for that same good by a retail store that does not offer a coupon for it. -- Incorrect. This is a trap choice. The passage doesn't suggest if the price of same goods would be increased or whether prices of other goods would be increased. This statement isn't "must be true" which is a characteristic for inference question.

Burhan1709 · Answer

The best way to eliminate Option E is it is talking about individual products whereas in paragraph it is mentioned that the average prices of the goods in the retail stores that provide coupon is higher than the price for that good in the retail store without coupon. So, it is not necessarily that the price would be higher. Hence, Option E can be eliminated easily.

VerbalBot · Answer

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