PrepTest 112, Section 1, Question 12
The consumer price index is a measure that(79 more words not shown)
The reasoning in the argument(9 more words not shown)
- Afails to consider(17 more words not shown)
- Bfails to make(12 more words not shown)
- Cpresumes, without providing(12 more words not shown)
- Duncritically draws an(17 more words not shown)
- Emakes an irrelevant(9 more words not shown)
Reading the argument
Wouldn't a lower price already show up in the index?
Basing retirement benefits on what people have to pay makes sense as a starting point. The objection is that the index doesn't separately consider new technology. But suppose new technology makes milk cheaper at the store. An index that tracks retail prices should pick up that lower price without having a separate entry for the technology that produced it. Ignoring the machinery isn't necessarily ignoring its effect.
What we’re looking for
That's my first concern with the conclusion that the benefits are too generous. We need to know whether these advances actually change the costs relevant to the people receiving the benefits, and whether the index misses that change. Simply pointing out that the index doesn't track technological innovation hasn't shown either problem. For this flaw question, I'll look for an answer explaining why that omission doesn't establish an inaccurate cost-of-living measure.
Working the answers
- A
A year with no change in the index doesn't address the disputed link. The argument could still claim the index fails to reflect technological improvements during a flat year, just as it could during a year with rising prices. The missing step is showing that the supposed omission makes measured living costs too high. A doesn't identify that mistake.
- B
We don't need a complete shopping list to assess this reasoning. Whether the index includes milk, gasoline, or some other retail goods, the argument must connect its evidence about technological advances to the living costs it says are overstated. Listing every item wouldn't fix that connection.
- C
The author doesn't base the criticism on retirees buying ordinary goods rather than unusual ones. The stated reason is that technological improvements aren't considered. A different discussion might ask whether an index covers what its users buy, but C doesn't identify the gap between this author's evidence about technology and the conclusion about excessive benefits.
- D
The author isn't using a past pattern to predict that the same pattern will continue. The conclusion is that benefits are sometimes too high because of how the index works. We should look for a problem in that proposed relationship, not a forecast that the argument never makes.
- ECorrect
This catches a more precise shift than my first reaction did. The index tracks the prices customers pay. The technological innovations reduce the cost of producing goods. Those are two different amounts.
Suppose a product used to cost a company $2 to make and sold for $3. New equipment lowers the production cost to $1, but the company keeps charging $3. The company saves a dollar. The customer saves nothing. An index showing no change in that retail price would accurately reflect what the customer still has to pay.
The argument treats lower production costs as though they establish lower living costs. They don't. If savings do reach consumers, my original concern applies: lower retail prices can be captured by the index. If the company keeps the savings, the lower production costs provide no reason to cut the consumers' benefits. E identifies the unsupported switch that the argument needs us to overlook.
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