Q7 - Economist: Government intervention in the free market i

[samantha.rose.shulman]

PT65, S1, Q7 (Inference)

(D) is correct.

This is an Inference question. Usually correct answers are not predictable for this question type, but since this is a fill-in-the-blank question (a kind of Inference question), it is a bit more predictable than usual. Like with all Inference questions, we can only use the information in the stimulus to arrive at the correct answer.

First, the stimulus makes it clear that government intervention in the free market and the administration of medicines are comparable. The stimulus then states the conditions under which the administration of medicines is justified. The final sentence, which we must complete, starts with the phrase "similarly, government intervention in the free market is justified only when it _______". By the end of the stimulus our task should become clear - we need to match the justification for administering medicines to government intervention in the free market.

The next question we should ask ourselves is, when is administering medicines justified? Our stimulus tells us it is only justified when its non-use would be significantly more harmful than its use. Therefore, we are looking for an answer choice that specifically tells us that government intervention is only justified when the lack of intervention would cause significantly more harm than intervention in the free market.

With this in mind, let’s look at our answer choices.

(A) is incorrect. In the comparable situation (administering medicines), approval of the affected participants is never mentioned and is therefore irrelevant.

(B) is more attractive, but still incorrect. Just because government intervention has been shown to have few if any significantly harmful effects, does not mean we can conclude that it is less harmful than no intervention at all. We need more information for this answer choice to be correct.

(C) is incorrect. Like (B) we need more information. Just because we know intervention will not exacerbate any existing problem does not mean we know that it is less harmful than no intervention at all.

(E) is incorrect. Who cares? Just because intervention solves some otherwise unsolvable problem doesn’t mean that it does less harm than no intervention at all. This answer choice is flawed in the same fashion as (B) and (C).

(D) is a perfect fit and completes our comparison! This matches the justification for administering medicines almost word-for-word.