A local coffee shop owner plans to increase total monthly profits by raising the price of all specialty espresso drinks by 10 percent. The owner reasons that because demand for specialty drinks has remained steady over the past year, customers will continue to buy the exact same quantity of drinks despite the price increase.
Which of the following would be most useful to evaluate the validity of the coffee shop owner's argument?
- AWhether coffee shops in neighboring towns raised their specialty drink prices six months ago.
- BWhether the historical cost of raw coffee beans has fluctuated significantly over the past decade.
- Whether the price increase will cause a significant number of customers to switch to cheaper alternatives or stop buying drinks.Cevap
- DWhether customer satisfaction ratings for the coffee shop were higher this year than in previous years.
- EWhether reducing the price of non-espresso drip coffee would double the total number of cups sold per day.
Cevap
Determining whether the price increase will cause a significant number of customers to switch to cheaper alternatives or stop buying drinks is most useful for evaluating the argument.
The correct answer provides information that directly addresses the core assumption of the argument. Applying the Test of Variance: if the price increase causes customers to switch to cheaper drinks or leave, sales volume will decline and ruin profitability; if it does not cause customer loss, revenue and profits will rise as intended. Because the two extreme answers produce opposite impacts on the conclusion, this information is critical for evaluating argument validity.
Adım Adım Çözüm
Anahtar Kavram
Evaluating Argument Validity and Test of Variance