Help: GWD9-24?

jmbnzhu

For similar cars and drivers, automobile insurance for collision damage has always cost more in Greatport than in Fairmont. Police studies, however, show that cars owned by Greatport residents are, on average, slightly less likely to be involved in a collision than cars in Fairmont. Clearly, therefore, insurance companies are making a greater profit on collision-damage insurance in Greatport than in Fairmont.

 

Which of the following is an assumption on which the argument depends?

 

A.    Repairing typical collision damage does not cost more in Greatport than in Fairmont.

B.    There are no more motorists in Greatport than in Fairmont.

C.    Greatport residents who have been in a collision are more likely to report it to their insurance company than Fairmont residents are.

D.    Fairmont and Greatport are the cities with the highest collision-damage insurance rates.

E.     The insurance companies were already aware of the difference in the likelihood of collisions before the publication of the police reports.

 

The given answer is A. I donot know why.

KennyChenzju

profit = revenue - cost

Revenue来自每张保单×投保的数量， Cost是每次repair的时候保险公司应付的赔偿。题目从Greatport的车主保险比较高，但是发生事故的车的数量比较少，推断出Greatport的保险公司利润比较高。但是忽略了一项，就是发生事故的车辆数量虽然比较少，但是要是每次repair的成本很高的话，保险公司赔偿的成本也增加，这就不能保证利润大。所以A是假定一般性的维修成本不比Fairmont高，利润才会更大。

不过个人觉得如果能再加一个assumption，Greatport投保的车并不比Fairmont少会更完整－－个人意见

jmbnzhu

got it. thank y