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11 Jul 2017, 06:09
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A
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
45%
(medium)
Question Stats:
67% (01:47) correct
33%
(02:01)
wrong
based on 453
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All other things being equal, car insurance for the repair of collision damage costs more in Richmond than in Layton. Interestingly, drivers in Richmond are statistically less likely to be involved in an accident while driving than are drivers in Layton. Clearly, insurance companies have a larger profit margin on policies covering cars in Richmond when compared with those covering cars in Layton.
Which of the following, if true, most strengthens the above argument?
A. The average cost of repairing collision damage costs about the same in Richmond as it does in Layton.
B. Layton and Richmond have roughly equivalent populations.
C. Drivers in Richmond who have been involved in an accident are less likely to notify the police than are drivers in Layton.
D. Collision damage insurance costs more in Layton than every other neighboring municipality, excepting Richmond.
E. Consumer watch groups have long suspected that insurance companies are charging inflated premiums for coverage of vehicles in Richmond.
Which of the following, if true, most strengthens the above argument?
A. The average cost of repairing collision damage costs about the same in Richmond as it does in Layton.
B. Layton and Richmond have roughly equivalent populations.
C. Drivers in Richmond who have been involved in an accident are less likely to notify the police than are drivers in Layton.
D. Collision damage insurance costs more in Layton than every other neighboring municipality, excepting Richmond.
E. Consumer watch groups have long suspected that insurance companies are charging inflated premiums for coverage of vehicles in Richmond.
11 Jul 2017, 09:26
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rohan2345
We have to focus on the conclusion, that's what we are trying to strengthen - insurance companies have a larger profit margin in Richmond.
(A) From premise 1: car insurance in Richmond is higher, say $1,500 in Ricmond and $1,000 in Layton. If the average cost of repairing is the same in both cities, say $800, then: profit margin in Richmond is $1,500 - $800 = $700
profit margin in Richmond is $1,000 - $800 = $200
Hence, (A) strengthens the conclusion : have a larger profit margin in Richmond
(B) irrelevant, the argument is not about population size
(C) irrelevant, we are talking about profit margin
(D) Irrelevant. This answer choice says that insurance costs in Richmond> insurance costs in Layton > insurance costs in every other neighboring municipality.
(E) This one is interesting. However, the conclusion includes a conclusion indicator "Clearly". What watch groups suspect is irrelevant, and this choice does not strenghten the conclusion.
11 Jul 2017, 09:37
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We know:
- insurance costs more in R
- there are fewer accidents in R
and the conclusion is that insurers are making bigger profits in R. But there's one thing we don't know about - the cost of the accidents in R. Maybe everyone in R drives really rare or expensive cars that cost a lot to repair. Then the insurers might not be making a lot of profit in R, despite the higher insurance rates and lower accident rate, because the insurers might have very high expenses there. That's why the information in A is so helpful here.
None of the other answers are relevant - we don't care about population size, notifying the police, what happens in communities besides Richmond and Layton, or whether consumer groups have noticed that the insurance premiums are high.
- insurance costs more in R
- there are fewer accidents in R
and the conclusion is that insurers are making bigger profits in R. But there's one thing we don't know about - the cost of the accidents in R. Maybe everyone in R drives really rare or expensive cars that cost a lot to repair. Then the insurers might not be making a lot of profit in R, despite the higher insurance rates and lower accident rate, because the insurers might have very high expenses there. That's why the information in A is so helpful here.
None of the other answers are relevant - we don't care about population size, notifying the police, what happens in communities besides Richmond and Layton, or whether consumer groups have noticed that the insurance premiums are high.
