Economist: ChesChem, a chemical manufacturer located in Chester, uses natural gas for its enormous energy needs. Curr...

on September 14 at 09:18PM

Correct answer?

I got this answer right but was very hesitant about it. Could somebody break it down - explain the best way to approach the question and get the answer? Thanks.

1 Reply

Irina on September 14 at 09:38PM

@hales,

The argument tells us that if the cost of natural gas in Chester becomes more than twice the cost in Tilsen, the company will move its operations. Currently, natural gas costs twice as much in Chester than in Tilsen. The argument then concludes that if the cost of natural gas in Chester increases at all, the company will move its operations.

Natural gas currently 2x in Chester
natural price goes up
_________________
move operations

This is a fairly straightforward argument that requires us to identify an assumption that would ensure that if the cost of natural gas in Chester increases, it will cost more than twice as much than it does in Tilsen. If the cost of natural gas in Tilsen increases proportionally for example, the cost of gas in Chester will still only be twice as much as in Tilsen, not more than twice as much as the conclusion requires. This assumption is correctly expressed by answer choice (B).

The rest of the answer choices might look attractive but they are irrelevant to the conditional rule in this argument:

Price more than 2x -> move operations

(A), (C) , (D) talk about profits/ expenses/ benefits, which are not part of the argument, and (E) reverses the conclusion saying that if the company moves -> the price must have increased.

The best way to approach these question is to identify the relevant parts of the argument - premises and conclusion and write them out/ or just think about them in a logical order. The required assumption should fill an obvious gap between the premises and the conclusion. In this case the argument jumps from saying price goes up to the price will be more than 2x - well, how do we know that? The only way we could conclude that is we assumed that the price in another city does not go up proportionally.

Let me know if this makes sense and if you have any further questions.