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The patent on the molecule that is central to a popular low-calorie sweetener recently expired, meaning that the molecule can...

GMAT Critical Reasoning : (CR) Questions

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Critical Reasoning
Paradox
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The patent on the molecule that is central to a popular low-calorie sweetener recently expired, meaning that the molecule can now be used by companies other than the sweetener's inventor. During the time the company has held the monopoly on the sweetener, it has accounted for a large percentage of the company's sales and profits. Yet the company is unconcerned about the possibility that the popular low-calorie sweetener will lose sales or profits to competing versions of the sweetener.

Which of the following, if true, would most clearly explain the company's attitude?

A
Food manufacturers, rather than retail consumers, are the primary market for the sweetener.
B
The company holds existing patents covering all known economically viable manufacturing processes for making the sweetener.
C
The sweetener, once rumored to cause cancer, was recently declared safe by government and independent testing agencies.
D
The company has reduced the price of the sweetener to increase its ability to compete with other sweeteners on the market.
E
The company has begun to try to develop a new sweetener that will reportedly taste more like real sugar than does the sweetener whose patent recently expired.
Solution

Passage Analysis:

Text from Passage Analysis
The patent on the molecule that is central to a popular low-calorie sweetener recently expired, meaning that the molecule can now be used by companies other than the sweetener's inventor.
  • What it says: The patent protection ended, so other companies can now make the same sweetener
  • What it does: Sets up the competitive threat scenario
  • What it is: Background factual information
  • Visualization: Before: Company A has exclusive rights to sweetener molecule → After: Companies A, B, C, D can all use the same molecule
During the time the company has held the monopoly on the sweetener, it has accounted for a large percentage of the company's sales and profits.
  • What it says: This sweetener has been a huge money-maker for the company during its exclusive period
  • What it does: Shows how important this product is to the company's business
  • What it is: Company financial information
  • Visualization: Company Revenue: Sweetener = 60-70% of total sales and profits, Other products = 30-40%
Yet the company is unconcerned about the possibility that the popular low-calorie sweetener will lose sales or profits to competing versions of the sweetener.
  • What it says: Despite the potential threat, the company isn't worried about losing business
  • What it does: Creates a puzzle by contrasting the expected concern with the actual lack of concern
  • What it is: Author's observation about company attitude
  • Visualization: Expected reaction: Company worried about competition → Actual reaction: Company relaxed and unconcerned

Argument Flow:

The argument presents a business puzzle. It first explains that a patent expired, opening up competition for a product that's been hugely profitable for the original company. Then it shows us the surprising fact that the company isn't worried about this competition.

Main Conclusion:

There's no explicit conclusion stated - this is a paradox that needs explanation. The puzzle is why the company remains unconcerned despite facing new competition for their major profit source.

Logical Structure:

This isn't a traditional argument with premises supporting a conclusion. Instead, it's a scenario that creates a logical puzzle: given that competition typically threatens profits, and this product is crucial to the company's success, why isn't the company worried? We need to find information that would resolve this apparent contradiction.

Prethinking:

Question type:

Paradox - We need to find information that explains why the company isn't worried about losing sales and profits from their formerly exclusive sweetener, even though it was a huge part of their business and competitors can now make the same product.

Precision of Claims

The key claims are very specific: the patent expired (timing), the sweetener accounted for a 'large percentage' of sales and profits (quantity), and the company is 'unconcerned' about losing business to competitors (attitude). We need to respect all these facts while explaining the seemingly contradictory attitude.

Strategy

For paradox questions, we need to find scenarios that make the company's unconcerned attitude make perfect sense. We should think about reasons why losing patent exclusivity might not actually threaten their sales and profits from this sweetener. The key is finding logical explanations that reconcile the apparent contradiction between having a lot to lose and not being worried about it.

Answer Choices Explained
A
Food manufacturers, rather than retail consumers, are the primary market for the sweetener.
This tells us who buys the sweetener (food manufacturers vs retail consumers), but this doesn't explain why the company wouldn't worry about competition. Whether their customers are manufacturers or consumers, competitors could still steal market share from either group once they can make the same product. This doesn't resolve the paradox of why they're unconcerned.
B
The company holds existing patents covering all known economically viable manufacturing processes for making the sweetener.
This is the perfect explanation! Even though competitors can now legally use the sweetener molecule, they still can't actually manufacture it economically because this company controls all the viable production processes through separate patents. It's like other companies having the recipe but no access to working equipment. This gives the original company continued protection even after the molecule patent expired, completely explaining why they're not worried about losing sales.
C
The sweetener, once rumored to cause cancer, was recently declared safe by government and independent testing agencies.
The safety declaration might help sales generally, but it doesn't explain why the company isn't worried about competitors specifically. In fact, if the sweetener is now declared safe, that might make it even more attractive for competitors to manufacture, making the company's lack of concern even more puzzling rather than explaining it.
D
The company has reduced the price of the sweetener to increase its ability to compete with other sweeteners on the market.
Reducing prices to stay competitive actually suggests the company IS concerned about competition and is taking defensive action. This contradicts the passage's claim that the company is unconcerned, so this doesn't explain their attitude at all.
E
The company has begun to try to develop a new sweetener that will reportedly taste more like real sugar than does the sweetener whose patent recently expired.
Developing a new sweetener shows the company is working on future products, but doesn't explain why they're unconcerned about losing profits from their current major product. Plus, developing a replacement suggests they might actually be worried about the current sweetener's future, which contradicts their stated unconcern.
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