LSAT 157 – Section 3 – Question 18

LSAT 157 - Section 3 - Question 18

June 2020

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Question
QuickView		 Type Tags Answer
Choices		 Curve Question
Difficulty		 Psg/Game/S
Difficulty		 Explanation
PT157 S3 Q18
+LR
Except +Exc
Resolve reconcile or explain +RRE
A
11%
151
B
45%
162
C
30%
155
D
9%
152
E
6%
149
147
160
173
 +Hardest 145.111 +SubsectionEasier

Consumer demand for personal computers continues to increase each year, which might lead one to think that the profits earned selling personal computers at the retail level are very high relative to total retail sales of personal computers. Yet the retail profit margin on personal computer sales is extremely low compared to that of other popular high-technology items.

"Surprising" Phenomenon
Why is the retail profit margin on personal computers very low compared to other popular hi-tech items, even though demand for personal computers increases every year?

Objective
This is an EXCEPT question. The four wrong answers will help explain why retail profits on personal computer sales might not be as high as we would expect given the demand for personal computers.

A
Rapid innovation in computer technology increases the likelihood of a store’s stock becoming obsolete.
This suggests computers purchased by a store for sale to consumers quickly become obsolete, which could make them harder to sell. If stores carry obsolete computers, this could depress the profits earned on the sale of computers.
B
Satisfaction with their first personal computer tends to make customers very loyal to that particular brand.
This suggests brands want first-time customers to have a good experience. But this doesn’t suggest that profits would be lower for personal computers than we would otherwise expect. If anything, brand loyalty might allow for higher prices on popular brands, increasing profits.
C
A customer needs more help from store employees when buying a personal computer than when buying other high-technology items.
This raises a reasonable possibility that selling personal computers requires hiring more employees, which raises the costs of selling those computers.
D
Many retail stores have low prices on personal computers in order to bring in customers who might buy software and accessories.
Stores might choose lower profits from personal computer sales in order to increase profit from other products.
E
An increase in the number of discount retail outlets selling personal computers has intensified the competition for customers.
Greater competition for personal computer sales will likely lead to lower prices, which reduces profit margin.

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LSAT PrepTest 157 Explanations

Section 1 - Reading Comprehension

Section 2 - Logical Reasoning

Section 3 - Logical Reasoning

Section 4 - Reading Comprehension

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