A This point merely tells us how much coffee consumption has decreased; itdoes not make the explanation offered in the conclusion any less likely to becorrect.B Withdrawal symptoms would occur only after decreased consumption hasoccurred and so cannot explain why the decrease occurred.
C Suppose that the specialty coffees that had their sales hold steady were allcaffeine-free coffees; note that nothing rules this out. If this were the case,the explanation would remain plausible.D An increase in the consumption of these drinks could plausibly be theresult of some coffee drinkers switching to these drinks to avoid thenegative effects of caffeine.E Correct.This statement properly identifies a plausible alternativeexplanation and therefore undermines the given explanation.The correct answer is E.46. Which of the following best completes the passage below?When the products of several competing suppliers are perceived by consumers tobe essentially the same, classical economics predicts that price competition willreduce prices to the same minimal levels and all suppliers’ profits to the sameminimal levels. Therefore, if classical economics is true, and given suppliers’ desireto make as much profit as possible, it should be expected that .(A) in a crowded market widely differing prices will be charged for productsthat are essentially the same as each other(B) as a market becomes less crowded as suppliers leave, the profits of theremaining suppliers will tend to decrease(C) each supplier in a crowded market will try to convince consumers thatits product differs significantly from its competitors’ products.(D) when consumers are unable to distinguish the products in a crowdedmarket, consumers will judge that the higher-priced products are of higherquality(E) suppliers in crowded markets will have more incentive to reduce pricesand thus increase sales than to introduce innovations that would distinguishtheir product from their competitors’ productsArgument ConstructionSituationClassical economics holds that prices and profits are minimal whenconsumers perceive the products of competing suppliers to be thesame.ReasoningAccording to classical economics, what strategy are suppliers mostlikely to use to maximize profits in such a situation?The giveninformation states that the force driving prices and profits down inthis case is the consumers’ perception that the competing productsare essentiallythe same. It is reasonable to assume that, withprices already at minimal levels, it is not possible to lower themany more. What can be done? The suppliers’ most likely strategy
would then be to change the consumers’ perception of theirproducts. It can be expected that an individual supplier would try toconvince consumers that its product greatly differs from (and iscertainly preferable to) the products of its competitors.