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Question: Economist: In the interaction between producers and consumers, the only obligation that all parties have is to act in the best interests of their own side. And distribution of information about product defects is in the best interests of the consumer. So consumers are always obligated to report product defects they discover, while producers are never obligated to reveal them.
Which one of the following is an assumption required by the economist's argument?
A) It is never in the best interests of producers for a producer to reveal a product defect.
B) No one expects producers to act in a manner counter to their own best interests.
C) Any product defect is likely to be discovered by a consumer than by a producer.
D) A product defect is more likely to be discovered by a consumer than by a producer.
E) The best interests of consumers never coincide with the best interests of producers.
Answer: A
Explanation
Given that, Economist: Producers and consumers simply have to behave in their own interests. Distributing product defect information benefits consumers. Therefore, consumers must disclose product flaws they find, but producers are not.
Let's approach the answer choices.
A: Correct
This assumption is required for the economist's argument to hold. The economist's argument is based on the premise that all parties (producers and consumers) act in their own best interests. If it is assumed that producers should never reveal product defects because it is against their best interests, then the argument's conclusion that producers are never obligated to reveal defects aligns with this assumption
B: Incorrect
This option may seem relevant, but the argument doesn't explicitly rely on the expectation of how producers will act. Instead, it focuses on the inherent obligation based on self-interest. The argument assumes that parties will act in their best interests, but it's not about expectations.
C: Incorrect
While this options might seem relevant to the overall topic of product defects, they are not necessary assumptions for the argument. The argument doesn't rely on the relative likelihood of who discovers defects; it focuses on the obligations of both parties based on self-interest.
D: Incorrect
While this options might seem relevant to the overall topic of product defects, they are not necessary assumptions for the argument. The argument doesn't rely on the relative likelihood of who discovers defects; it focuses on the obligations of both parties based on self-interest.
E: Incorrect
This option goes against the economist's argument, which assumes that both parties act in their own best interests. The argument doesn't require the assumption that their interests never coincide; it's more about fulfilling obligations based on self-interest.
“Economist: In the interaction between producers and consumers”– is a GMAT Critical question. To answer the question, a candidate can either find a piece of evidence that would weaken the argument or have logical flaws in the argument. GMAT critical reasoning tests the logical and analytical skills of the candidates. This topic requires candidates to find the argument's strengths and weaknesses or the logical flaw in the argument. The GMAT CR section contains 10 -13 GMAT critical reasoning questions out of 36 GMAT verbal questions.
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