If the price it pays for coffee beans continues to increase, the Coffee Shoppe will have to increase its prices. In that case, either the Coffee Shoppe will begin selling noncoffee products or its coffee sales will decrease. But selling noncoffee products will decrease the Coffee Shoppe's overall profitability. Moreover, the Coffee Shoppe can avoid a decrease in overall profitability only if its coffee sales do not decrease.
This stimulus is packed with conditional rules, so let's break each one down carefully and then see whether they connect.
Sentence 1: If the price the Coffee Shoppe pays for beans continues to increase, it will have to increase its prices. (bean price goes up → CS price goes up)
Sentence 2: If it increases its prices, then it will sell noncoffee products or its coffee sales will decrease (or both). (CS price goes up → sell noncoffee OR sales go down)
Sentence 3: Selling noncoffee products will decrease overall profitability. (sell noncoffee → overall profits go down)
Sentence 4: The last sentence uses "only if," which introduces a necessary condition. "Only if" tells us what must be true in order for something else to have any chance of being true. So this sentence means: if the Coffee Shoppe avoids a decrease in profitability, then must be the case that its coffee sales did not decrease. Or, the contrapositive (which just restates the same relationship): if coffee sales decrease, then overall profitability decreases. (sales go down → overall profits go down)
We can chain these statements together. According to Sentence 2, if the Coffee Shoppe increases its prices, it will either sell noncoffee products or its coffee sales will decrease. What happens along each path?
goes up
prices go up
go down
If the Coffee Shoppe sells noncoffee products, Sentence 3 tells us profitability decreases. If coffee sales decrease, Sentence 4 tells us profitability decreases. Both branches of the "or" lead to the same result. So no matter which path the Coffee Shoppe ends up on, if bean price goes up, overall profitability will go down.
Which one of the following statements follows logically from the statements above?
If the Coffee Shoppe's overall profitability decreases, the price it pays for coffee beans will have continued to increase.
(A) reverses the direction of the conditional chain. The stimulus establishes that if the price for beans increases, then profitability decreases. (A) claims the reverse: if profitability decreases, then the price for beans must have increased. But decreased profitability could result from all sorts of things that have nothing to do with bean prices. The stimulus tells us only that bean prices going up is one thing that's sufficient for decreased profitability. It doesn't tell us that bean price increases are the only path to decreased profitability.
If the Coffee Shoppe's overall profitability decreases, either it will have begun selling noncoffee products or its coffee sales will have decreased.
(B) claims that if profitability decreases, the Coffee Shoppe will have sold noncoffee products or its coffee sales will have decreased. But there's the same direction problem as (A). We know that selling noncoffee products or having decreased coffee sales each lead to decreased profitability. That doesn't mean decreased profitability must have come from one of those two sources. Profitability could decrease for a completely unrelated reason.
The Coffee Shoppe's overall profitability will decrease if the price it pays for coffee beans continues to increase.
This follows from the conditional chain. If the price for beans increases, the Coffee Shoppe must increase its prices. Once it increases its prices, it must either sell noncoffee products or see its coffee sales decrease. Selling noncoffee products leads to decreased profitability (Sentence 3). And a decrease in coffee sales also leads to decreased profitability (Sentence 4). Since both branches of the "or" result in decreased profitability, the price for beans continuing to increase guarantees that overall profitability will decrease.
The price it pays for coffee beans cannot decrease without the Coffee Shoppe's overall profitability also decreasing.
(D) says that a decrease in the price of beans would lead to decreased profitability. But the stimulus tells us what happens if the price of beans increases. We have no information about what would happen if bean prices decreased.
Either the price it pays for coffee beans will continue to increase or the Coffee Shoppe's coffee sales will increase.
(E) presents a false dilemma. It claims that either bean prices will increase or coffee sales will increase. But nothing in the stimulus establishes that one of these two things must happen. The stimulus tells us what follows if bean prices increase, but it never says what guarantees that bean prices will increase. Nor does it say anything about circumstances under which coffee sales would increase. So it's possible that neither of the options in (E) happens.
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