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1000 CR test 1 no 12

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magical cook Master | Next Rank: 500 Posts Default Avatar
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1000 CR test 1 no 12

Post Sat Mar 24, 2007 5:05 pm
Hi,

the answer is C) but I have difficulty in understanding "those growers no better off than if none of them had switched".....

Some observers have concluded that the rise in the price of pepper means that the switch by some growers from pepper to cocoa left those growers no better off than if none of them had switched; this conclusion, however, is unwarranted because it can be inferred to be likely that

(A) those growers could not have foreseen how high the price of pepper would go
(B) the initial cost involved in switching from pepper to cocoa is substantial
(C) supplies of pepper would not be as low as they are if those growers had not switched crops
(D) cocoa crops are as susceptible to being reduced by bad weather as are pepper crops
(E) as more growers turn to growing cocoa, cocoa supplies will increase and the price of cocoa will fall precipitously

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rajesh_ctm Master | Next Rank: 500 Posts Default Avatar
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Post Sun Mar 25, 2007 9:44 am
Some observers have concluded that the rise in the price of pepper means that the switch by some growers from pepper to cocoa left those growers no better off than if none of them had switched;

Facts:
Price of pepper was lower
Some pepper growers shifted to other crops (maybe because of low price and hence low profit)
Now the price of pepper is high.
(Conclusion) - If those growers did not shift, they would benefit from the rise in prices. Hence they are no better off today.

The author assumes that the prices would have increased even if the growers had not shifted. While the truth could be that since some pepper growers stopped growing pepper, the supply decreased and hence the price went up. In this case, the prices would still be low if some growers did not shift.

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magical cook Master | Next Rank: 500 Posts Default Avatar
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Post Sun Mar 25, 2007 3:03 pm
Okay - that's pretty clear now.Smile thanks!

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