Question

A product that represents a clear technological advance over competing products can generally command a high price. Because technological advances tend to be quickly surpassed and companies want to make large profits while they still can, many companies charge the maximum possible price for such a product. But large profits on the new product will give competitors a strong incentive to quickly match the new product's capabilities. Consequently, the strategy to maximize overall profit from a new product is to charge less than the greatest possible price.
In the argument above, the two portions in boldface play which of the following roles?
(A) The first is an assumption that forms the basis for a course of action that the argument criticizes; the second presents the course of action endorsed by the argument.
(B) The first is a consideration raised to explain the appeal of a certain strategy; the second is a consideration raised to call into question the wisdom of adopting that strategy.
(C) The first is an assumption that has been used to justify a certain strategy; the second is a consideration that is used to cast doubt on that assumption.
(D) The first is a consideration raised in support of a strategy the argument endorses; the second presents grounds in support of that consideration.
(E) The first is a consideration raised to show that adopting a certain strategy is unlikely to achieve the intended effect; the second is presented to explain the appeal of that strategy.

Answer 1

The statement with the underlined parts in bold is as follows:

A product that represents a clear technological advance over competing products can generally command a high price. Because technological advances tend to be quickly surpassed and companies want to make large profits while they still can, many companies charge the maximum possible price for such a product. But large profits on the new product will give competitors a strong incentive to quickly match the new product's capabilities. Consequently, the strategy to maximize overall profit from a new product is to charge less than the greatest possible price.

In the argument above, the two portions in boldface play which of the following roles?

(A) The first is an assumption that forms the basis for a course of action that the argument criticizes; the second presents the course of action endorsed by the argument.

(B) The first is a consideration raised to explain the appeal of a certain strategy; the second is a consideration raised to call into question the wisdom of adopting that strategy.

(C) The first is an assumption that has been used to justify a certain strategy; the second is a consideration that is used to cast doubt on that assumption.

(D) The first is a consideration raised in support of a strategy the argument endorses; the second presents grounds in support of that consideration.

(E) The first is a consideration raised to show that adopting a certain strategy is unlikely to achieve the intended effect; the second is presented to explain the appeal of that strategy.

Answer:

The answer is the option D

Explanation:

Companies know that by releasing a new product quickly, the competition will do everything possible to obtain a new product with the same characteristics but at a lower price.

Therefore the second part in bold supports the effect of what the first part of the text that is in bold says.