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    Question

    Premise: A new drug, CureMax, developed for a

    chronic respiratory disease, has shown a remarkably high cure rate, reducing the duration of the illness from years to just a few months. However, analysts warn investors that CureMax may not be profitable in the long run. They argue that because the drug effectively eliminates the disease in most patients, the number of repeat customers will drastically decline in the coming years. They point to earlier examples where highly effective cures significantly shrank the long-term market for the drug. Which of the following statements, if true, most strengthens the analysts’ argument? 1. CureMax has been found to cure 95% of patients within the first treatment cycle. 2. Several pharmaceutical companies prefer developing long-term therapy drugs because they provide steady annual revenue. 3. The company producing CureMax has recently increased its research expenditure by 40%.
    A Only 1 Correct Answer Incorrect Answer
    B Only 2 Correct Answer Incorrect Answer
    C Only 3 Correct Answer Incorrect Answer
    D Only 1 and 2 Correct Answer Incorrect Answer

    Solution

    Statement 1 strengthens the argument. A 95% cure rate means CureMax will drastically reduce the pool of future patients, directly supporting the analysts’ warning that its own effectiveness will shrink its long-term market. Statement 2 does not strengthen the argument. It is a general industry observation and does not directly relate to CureMax’s market shrinking due to its high effectiveness. Statement 3 does not strengthen the argument. Increased research expenditure does not affect the claim that creating an effective cure reduces long-term profitability.

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