When we're asked to EVALUATE an argument, we need to establish the conclusion of the argument and its supporting premises. We then need to determine what information is MISSING.

Premises:
- For similar homes and comparable residents, home insurance for theft has always cost more in Springfield than in Shelbyville.
- homes owned by Springfield residents are, on average, slightly less likely to be robbed than homes in Shelbyville.

Conclusion:
- insurance companies are making a greater pro�t on home theft insurance in Springfield than in Shelbyville.

Missing Information:
Whenever we see a conclusion about PROFIT, we need information about REVENUE and COSTS.
- We're told that Springfield insurance costs more per person, so we can assume higher revenue per customer. But are costs the same?
- What if costs are somehow higher, even though houses are less likely to be robbed?


A. the population density of Springfield with the population density of Shelbyville
- if the population density is higher... insurance could still be more profitable per person in one town or the other.

B. the cost of compensating theft losses in Springfield with the cost of compensating theft losses in Shelbyville
- if the cost is higher... this weakens the conclusion about profit being higher. If the cost is lower, it strengthens the conclusion. Correct!

C. the rates Springfield residents pay for auto insurance with the rates paid for auto insurance by residents of Shelbyville
- auto insurance is irrelevant.

D. the condition of Springfield's roads and streets with the condition of Shelbyville's roads and streets
- roads are irrelevant to home insurance / theft

E. the cost of home theft insurance in Springfield and Shelbyville with that in other cities
- other cities are irrelevant - this argument is only concerned with these 2 cities.

The answer is B.