PrepTest 137

Incorrect. This answer can look appealing. However, it's possible that these coupon clippers only buy the discounted items at the stores, not the overpriced items that don't have coupons, thus saving money overall (while other shoppers overpay by buying the above-average-costing items).

Correct. Argument or Facts:
Facts

Question Type:
Must Be True

Stimulus Summary:
Some retail stores offer coupons, which consumers use to save money, but the coupons are expensive to print. The stores pass on this cost to consumers, and because of this the average product price at these stores is higher than at non-discounting stores.

Answer Anticipation:
There's something that should stick out to you while reading through this Must Be True stimulus—all the connecting and argument-structure language ("However"; "This is because"; "To compensate for this"). These connections (both suggesting arguments and causal relationships) are generally absent from Must Be True questions, and they connect causal and logical relationships that usually don't exist.

As such, we can support an answer that connects ideas a bit more strongly than in the average question of this type. These connections, for instance, allow us to say that the cost of offering the coupons/discounts is made up for by raising prices on items at the store. This type of connection wouldn't normally be drawn, but the language here allows it to be.

Another note on inferences we can't draw—anything on specific prices, or prices on specific subsets of items. The stimulus only discusses the average prices, which doesn't tell us anything about how prices break down or compare between stores. While the average must be higher, individual subsets of items might be cheaper, as long as other subsets are higher to bring the average up.

Answer Explanation:
The stimulus notes that the discount stores pass on the costs of making coupons to their customers, which could only be done through charging higher prices, so this answer is supported by the stimulus. The connective language here ("by") is supported by the similar language in the stimulus ("This is because . . . "; "To compensate for this . . . ").

Key Takeaway:
Look for language that's different and stronger than you've seen in other Must Be True questions when tackling one—that language will allow you to draw inferences that you wouldn't be able to in other questions. Additionally, know when certain language doesn't allow you to make certain inferences, such as "average" not allowing inferences to be drawn about individual prices or subsets of prices.

Incorrect. While the coupon-focused stores do pass costs on to consumers, and the stimulus notes that it does so that profits aren't reduced, that doesn't mean that the overall profits are equivalent. It's possible that stores that offer coupons just draw in less business, or make less money per item, than other stores, even though their coupon strategies don't affect profitability.

Incorrect. Other expenses aren't discussed and thus are out of scope.

Incorrect. The stimulus discusses the prices at coupon-discounted stores on average compared to other stores, so many of the items at such a store could be cheaper than the same item at another store, as long as many of the other items have higher prices or a few of the items have much higher prices. Short version? When the stimulus discusses averages, you can't make a determination about any specific item or set of items.