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#8 - People always seem to associate high prices of products

LSAT Master
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Joined: Mon Jun 11, 2018 8:49 am
Points: 192

Hi PowerScore,

I picked (B) for this, but I had a question. If people buy more tea, doesn't that increase demand, whcih generates supply, which drives price down? I had a moment of hesitation on this answer choice and want to make sure that I got the question right for the right reason.

Dave Killoran
PowerScore Staff
PowerScore Staff
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Joined: Fri Mar 25, 2011 1:18 pm
Points: 2,615

No, you've taken it one step too far here. The increased demand definitely drives price up (as stated here in (B)), but it doesn't necessarily drive supply up. This is why (B) works as an answer, because it's indicating that lower-quality teas have higher prices due to this high demand

There are plenty of examples of items where demand rose, and then price rose, but supply did not then keep up the pace to drive prices back down, so its not a guarantee that it works that way.

Dave Killoran
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