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When a market containing several competing products finds a single pro

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When a market containing several competing products finds a single pro  [#permalink]

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New post Updated on: 11 May 2018, 09:08
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Difficulty:

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Question Stats:

84% (01:25) correct 16% (01:50) wrong based on 143 sessions

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Which of the following best completes the passage below?

When a market containing several competing products finds a single product offering beginning to dominate the competition in terms of consumer preference, most theories of economics predict that manufacturers of less-favored products will lower their prices to make their offerings more competitive. Thus, if these economic theories are correct, and a crowded market shows a trend of strong consumer preference towards a single product, one would expect that ______________.

(A) the most successful manufacturer in the market will begin to charge more for their product.
(B) manufacturers of less successful products within the market will charge less for those products.
(C) consumers will remain committed to the most popular product until new options are introduced.
(D) the products with the lowest market share will be discontinued by manufacturers.
(E) manufacturers will modify their products to more closely resemble the most preferred offering.

Originally posted by csaluja on 29 Jul 2017, 17:08.
Last edited by Bunuel on 11 May 2018, 09:08, edited 2 times in total.
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Re: When a market containing several competing products finds a single pro  [#permalink]

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New post 29 Jul 2017, 18:06
B? Isn't this a direct clause from the prompt rather than an inference?

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Re: When a market containing several competing products finds a single pro  [#permalink]

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New post 31 Jan 2018, 01:45
csaluja wrote:
Which of the following best completes the passage below?

When a market containing several competing products finds a single product offering beginning to dominate the competition in terms of consumer preference, most theories of economics predict that manufacturers of less-favored products will lower their prices to make their offerings more competitive. Thus, if these economic theories are correct, and a crowded market shows a trend of strong consumer preference towards a single product, one would expect that ______________.

(A) the most successful manufacturer in the market will begin to charge more for their product.
(B) manufacturers of less successful products within the market will charge less for those products.
(C) consumers will remain committed to the most popular product until new options are introduced.
(D) the products with the lowest market share will be discontinued by manufacturers.
(E) manufacturers will modify their products to more closely resemble the most preferred offering.


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Extract from Powerscore CR Bible:

Because the stimulus is preceded by the question stem, and the stimulus ends with a blank, you know you are dealing with a Fill in the Blank (FIB) question. The author states that if a single product offering dominates consumer preference, most economic theories would predict a decrease in the price of competing offerings. Thus, in cases of such a preference dominating product, one would expect what? This is an answer that can easily be prephrased: in the case of such market domination, we would expect the prices of competing products to drop as their manufacturers scramble to become more competitive.
Answer choice (A): Although we are told that economists would expect competing products’ prices to drop, the author does not discuss what happens with the dominant product in such a case. Thus, this answer fails the Fact Test. In addition, this answer is somewhat of an Opposite answer as it trades on the dominant producer raising prices as opposed to the lesser producers lowering prices. Since it cannot be confirmed by the information provided in the stimulus, this choice does not reflect the author’s main point.
Answer choice (B): This correct answer choice essentially restates our prephrase from the discussion above.
Answer choice (C): The author does not provide information regarding consumer trends going forward. Since this specific information is not discussed at all in the stimulus, this answer fails the Fact Test and cannot be the correct choice.
Answer choice (D): The stimulus provides that the response to a dominant offering will be a decrease in the prices of competing products. There is no reference to the question of whether the less popular offerings would be discontinued, so this choice cannot represent the main point of the passage.
Answer choice (E): This incorrect answer is a classic “could be true” answer, or perhaps even a “likely to be true” answer. That is, if we were to speculate as to the reactions of competing firms, this might be a tactic they would choose. However, since this idea was not referenced by the author, this choice cannot be confirmed by the information in the passage and cannot represent the author’s main point.
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Re: When a market containing several competing products finds a single pro &nbs [#permalink] 31 Jan 2018, 01:45
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