Self-study
From time to time there is a public outcry against predatory pricing—where a company deliberately sells its products at prices low enough to drive its competitors out of business. ███ ████ ████████ ███████ ██████ ██ ███████████ ███████ ████ █████ ███ ███████████ ██ ███ ██ █████████ ███ ████ ██████ ██ ███████ ███████████ ████ ███████ ███ ███████ ████ ███████ ███ ██████ ██ ████████████ ███████
Summary
The author concludes that predatory pricing should be acceptable.
Why?
Because even after the competitors of a company that practices predatory pricing go out of business, the threat of renewed competition will prevent the company from raising prices to unreasonable levels.
Notable Assumptions
The author assumes that if predatory pricing doesn’t lead a company to raise prices to unreasonable levels, then it should be acceptable.
The author assumes that there are no negative effects from predatory pricing that would justify not allowing it to occur.
22.
Which one of the following ██ ██ ██████████ ██ █████ ███ ████████ ████████
a
Any company that ██ ██████████ ████ ██████████ ██████ ███████████ ██ █████ ███ ███████
The concept of a “successful” company has no place in this argument. Also, the premise refers to the “threat” of renewed competition preventing prices from rising to unreasonable levels. This doesn’t require that competition actually resume.
b
It is unlikely ████ ███████ █████████ █████████ ████ ██████ ██ █████████ ███████ ███████████████
Not necessary, because even if several companies engage in predatory pricing at the same time, it could still be that one of the companies ends up prevailing. That company won’t raise prices to unreasonable levels.
c
Only the largest ███ ██████████ █████████ ███ ██████ ██ █████████ ███████ ███ █ █████████ ██████ ██ █████
The concept of “largest and wealthiest companies” has no place in the reasoning of this argument.
d
It is only ███████████ ██ ███ ██████ ██ ███████████ ████ █████ █████████ ████ ███████ ███████
Not necessary, because if there were other things that kept companies from raising prices besides just competition or the threat of competition, that wouldn’t undermine the argument. In fact, that would just be another reason prices won’t rise to unreasonable levels.
e
Any pricing practice ████ ████ ███ ██████ ██ ████████████ ██████ ██████ ██ ███████████
Necessary, because if it were not true — if there were some pricing practices that don’t result in unreasonable prices that still should NOT be acceptable — then the fact predatory pricing does not lead to unreasonable prices would not be enough to call predatory pricing acceptable. (E) is the author’s assumed connection from the premise to the conclusion.