A Product that Represents a Clear Technological Advance Over Competing Products can Generally Command a High Price

Question: A product that represents a clear technological advance over competing products can generally command a high price. Because technological advances tend to be quickly surpassed and companies want to make large profits while they still can, many companies charge the maximum possible price for such a product. But large profits on the new product will give competitors a strong incentive to quickly match the new product's capabilities. Consequently, the strategy to maximize overall profit from a new product is to charge less than the greatest possible price.

In the argument above, the two portions in boldface play which of the following roles?

1. The first is a consideration that has been raised to argue that a certain strategy is counterproductive; the second presents that strategy.
2. The first is a consideration raised to support the strategy that the argument recommends; the second presents that strategy.
3. The first is a consideration raised to explain the appeal of a certain strategy; the second presents that strategy.
4. The first is an assumption, rejected by the argument, that has been used to justify a course of action; the second presents that course of action.
5. The first is a consideration that has been used to justify pursuing a goal that the argument rejects; the second presents a course of action that has been adopted in pursuit of that goal.

A Product that Represents a Clear Technological Advance Over Competing Products can Generally Command a High Price is a GMAT critical reasoning topic. This GMAT Critical Reasoning topic has been taken from the book ‘ GMAT Official Guide 2022 Bundle’. In this question, the candidates need to provide an option that supports the argument provided in the passage. GMAT critical reasoning tests the logical and analytical skills of the candidates. Critical reasoning in GMAT requires candidates to find the strengths and weaknesses of the argument, or find the logical flaw in the argument.  The GMAT CR section contains 10 -13 GMAT critical reasoning questions out of 36 GMAT verbal questions.

Answer: C
Explanation:
This is a GMAT critical reasoning question. An assumption is an implied hypothesis. So we are looking for something that is implied in the argument. In case it is wrong or maybe disable the argument.

In the argument above, the two portions in underlined play which of the following roles:

1. The first is a consideration that has been raised to argue that a certain strategy is counterproductive; the second presents that strategy. – This cannot be the correct option. The reason is that the first is the position that the argument advocates; the second presents grounds for rejecting an alternate position. Hence, we can exclude this option. 
2. The first is a consideration raised to support the strategy that the argument recommends; the second presents that strategy. – Here, the first is the position that the argument advocates; the second is an alternative position that the argument rejects. Hence, this is also not the correct option.
3. The first is a consideration raised to explain the appeal of a certain strategy; the second presents that strategy. – In this option, the first presents a strategy for achieving a certain goal. The second presents a drawback to that strategy. Hence option C is the correct answer.
   
   We Have already received the correct answer. However, we will also check why D and E are not correct. 
    
4. The first is an assumption, rejected by the argument, that has been used to justify a course of action; the second presents that course of action. – The first presents a strategy for achieving a certain goal, and the second presents grounds for preferring a different goal. hence, this is also incorrect. 
5. The first is a consideration that has been used to justify pursuing a goal that the argument rejects; the second presents a course of action that has been adopted in pursuit of that goal. – The first presents a strategy that, according to the argument, is ineffective; the second presents a way of improving the effectiveness of that strategy. Since it does not match our requirements, we can deem this as incorrect. 

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