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# When a company refuses to allow other companies to produce

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When a company refuses to allow other companies to produce [#permalink]

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31 Dec 2012, 19:20
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Difficulty:

65% (hard)

Question Stats:

47% (02:01) correct 53% (01:27) wrong based on 313 sessions

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When a company refuses to allow other companies to produce patented technology, the consumer invariably loses. The company that holds the patent can charge exorbitant prices because there is no direct competition. When the patent expires, other companies are free to manufacture the technology and prices fall. Companies should therefore allow other manufacturers to license patented technology.

The argument above presupposes which of the following?

a. Companies cannot find legal ways to produce technology similar to patented technology.
b. Companies have an obligation to act in the best interest of the consumer.
c. Too many patents are granted to companies that are unwilling to share them.
d. The consumer can tell the difference between patented technology and inferior imitations.

Will provide the OA after some explanations.
[Reveal] Spoiler: OA

Last edited by krackgmat on 01 Jan 2013, 13:18, edited 1 time in total.
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31 Dec 2012, 21:10
krackgmat wrote:
When a company refuses to allow other companies to produce patented technology, the consumer invariably loses. The company that holds the patent can charge exorbitant prices because there is no direct competition. When the patent expires, other companies are free to manufacture the technology and prices fall. Companies should therefore allow other manufacturers to license patented technology.

The argument above presupposes which of the following?

a. Companies cannot find legal ways to produce technology similar to patented technology.
b. Companies have an obligation to act in the best interest of the consumer.
c. Too many patents are granted to companies that are unwilling to share them.
d. The consumer can tell the difference between patented technology and inferior imitations.

Will provide the OA after some explanations.

Honestly speaking, I felt the problem to be of 620-640ish level.
Anyways, the conclusion is "Companies should therefore allow other manufacturers to license patented technology." On allowing the other manufacturers to license patented technology, the prices will fall and the consumers can easily have an an access on the by-products of the technology. Here the word "should" plays the vital role.
Hence indirectly, it is stated that companies have an obligation to act in the best interest of the consumer.
+1B
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31 Dec 2012, 23:26
krackgmat wrote:
When a company refuses to allow other companies to produce patented technology, the consumer invariably loses. The company that holds the patent can charge exorbitant prices because there is no direct competition. When the patent expires, other companies are free to manufacture the technology and prices fall. Companies should therefore allow other manufacturers to license patented technology.

The argument above presupposes which of the following?

a. Companies cannot find legal ways to produce technology similar to patented technology.
b. Companies have an obligation to act in the best interest of the consumer.
c. Too many patents are granted to companies that are unwilling to share them.
d. The consumer can tell the difference between patented technology and inferior imitations.

Will provide the OA after some explanations.

IMO A is the best choice.

A) if companies cannot find an alternative to patented technology, then they have no other choice than to license the technology otherwise only the patent holder can use it. This choice fully supports the argument and conclusion.

B doesn't mention whether the obligation to act in the best interest of the consumer relates to the usage of patented technology.

C is irrelevant because the argument isn't about quantity.

D is irrelevant

E is irrelevant
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Re: When a company refuses to allow other companies to produce [#permalink]

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29 Jan 2013, 11:28
1
KUDOS
krackgmat wrote:
When a company refuses to allow other companies to produce patented technology, the consumer invariably loses. The company that holds the patent can charge exorbitant prices because there is no direct competition. When the patent expires, other companies are free to manufacture the technology and prices fall. Companies should therefore allow other manufacturers to license patented technology.

The argument above presupposes which of the following?

a. Companies cannot find legal ways to produce technology similar to patented technology.
b. Companies have an obligation to act in the best interest of the consumer.
c. Too many patents are granted to companies that are unwilling to share them.
d. The consumer can tell the difference between patented technology and inferior imitations.

Will provide the OA after some explanations.

My take will be Option B.

Conclusion : Companies should allow other manufacturers to license patented technology.

If we suggest a company to allow other manufacturers to license patent despite of the fact that the monopoly of the company from the market will be lost, then the only reason is the Consumers are the ones for which Companies care and are obligated to. Hence the unsaid assumption here is "Companies have an obligation to act in the best interest of the consumer"
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Re: When a company refuses to allow other companies to produce [#permalink]

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31 May 2015, 00:24
Hello from the GMAT Club VerbalBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

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Re: When a company refuses to allow other companies to produce [#permalink]

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31 May 2015, 08:23
B
Conclusion - Companies should therefore allow other manufacturers to license patented technology.
Premises - Companies do not allow use of patented products thus customers suffer
Assumption - Company should look into benefits for customers
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Re: When a company refuses to allow other companies to produce [#permalink]

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04 Jun 2015, 00:22
Premise (interm conclusion):
When a company refuses to allow other companies to produce patented technology, the consumer invariably loses

Conclusion (final):
Companies should therefore allow other manufacturers to license patented technology.

Prethink: If consumer loses the company should

B fits
Re: When a company refuses to allow other companies to produce   [#permalink] 04 Jun 2015, 00:22
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