Premise - 2 manufacturing systems are compared - Japanese system vs American system
Japanese system is superior than American system :
1) But capital invested is the same
2) 40% Japanese workers were college educated vs 8% Americans
3) Most (means >50%) Japanese workers were trained in that manufacturing system vs 25%Americans
Conclusion - We need to find some option that says - It was the education and training of Japanese workers that made their system superior
A - Japanese technology is clearly superior to that of the United States, at least in terms of flexible manufacturing systems - The passage does not mention the capability of the systems
B - America is unable to compete effectively because businesses are unwilling to make the capital investment necessary to make our systems competitive - We are told that they have similar investments but nothing is mentioned about the willingness/ability to invest more.
C. the superior flexibility of Japanese workers ensures the success of their systems - This is a trap answer. We do not know if the workers are flexible. Only the manufacturing system is flexible not the workers.
D. American workers are incapable of learning to deal with complex new CIM systems - Again nothing is mentioned about the ability. We do not know why they are not trained.
E. it was the education and training of the people who used the systems that made the essential difference - same as our conclusion - Correct answer