Q25

[Lisaandpeterlin]

Question 25 - can someone please answer how one B is the correct answer?

[ohthatpatrick]

Since there's so much Mackay in the passage, it's hard to limit ourselves to one "Proof Window" for this question stem.

I'd remind myself of Mackay's main points:
- this wasn't a speculative bubble
- it made rational sense to pay crazy amounts for a bulb early on, because you could feasibly expect a return on your investment by using that bulb to make tons of copies.

(A) He thinks the price did rise because the bulb became fashionable. That's also why he thinks that investors believed they would have time to make their money back on this popular flower, if they bought a bulb early.

(B) This seems counter to Mackay's central point that this was NOT a speculative bubble.

(C) "the only" is way too extreme ... easy giveaway that this is wrong.

(D) YUP, sounds like Mackay's main point -- the Dutch tulip bulb saga was NOT a speculative bubble. In lines 47-49 we even hear the words that "the high prices were not irrational".

(E) We never hear that they WERE ultimately able to derive earnings; we only hear in lines 49-55 that earning COULD be very high / an original bulb COULD generate a reasonable return.

That last answer is pretty mean, but the question stem doesn't say that we'll be inferring anything or speculating. It says that THE PASSAGE STATES this answer choice. (D) is much more explicitly stated than (E).

Hope this helps.

[RafaelP395]

I think you have confused Mackay's argument for Garber's (though your reasoning and approach are sound).

[NitanS934]

I agree with Rafael. It looks like Patrick may have accidentally confused Mackay's argument for Garber's and as a result provided the wrong answer. The correct answer here is B.

Argument: In the passage, the author explains that Mackay believes that “the seventeenth-century Dutch tulip market provides an example of a speculative bubble. The speculative bubble is when an asset’s price is driven up by “speculation that someone else will be willing to pay a higher price for it.” The author further explains that according to Mackay the rapid rise in prices in 1636 “attracted speculators.”

A) Incorrect. This answer choice was written to trick us. Garber mentions the fashionability of tulips (see the third paragraph) but Mackay never mentions it. We simply don’t know whether Mackay thinks it has to do with the fashionability of the flowers or not. Eliminate this answer choice.

B) Bingo! According to Mackay, “the seventeenth century Dutch tulip market provides an example of a speculative bubble.” The second paragraph in this passage goes on to show how the prices of “many varieties surged” in the seventeenth century Dutch tulip market due to the attraction of speculators.

Answer choice B hits all the marks. Notice how it says “certain” varieties of tulips. Mackay never says “all” Dutch tulips during the seventeenth century were determined by speculation. Also notice how it says “at least for a time.” Mackay doesn’t think that the price of tulips was “always” determined by speculation; in fact he only mentions how speculators affected the pricing in 1636. From there we are left with an assumption/inference that the prices were affected by speculation thereafter.

* There is one word in the answer choice that might cause test takers a pause: “determined.” More on that in the takeaway/patterns section below.

C) Incorrect. Too strong and out of scope. “The only” is really strong and is not supported by the passage. They tried to trick us here again by writing the answer choice in language similar to that of the first sentence in the second paragraph. However, you’ll notice that this sentence mentions that the Netherlands became “a” center and not “the” center (meaning there could be multiple centers, if you may). Also, notice that the first sentence in the second paragraph is described by the author and not Mackay. It’s reasonable to assume that Mackay thought that the Netherlands was a “center of cultivation and development of the new tulip varieties” but it is never explicitly described by Mackay. Eliminate this answer choice.

D) Incorrect. This answer choice tripped me when I first took this practice exam. I was an economics major for my undergrad and was taught that economists generally believe that people make rational choices. Mackay is an economist so he must think this, right? Wrong! Nowhere in the passage does it say that Mackay is an economist, and even if it did say this – Mackay never discusses rationality in his argument (only Garber does that in the last paragraph). This answer choice requires an assumption to be correct – that Mackay believes that high prices due to speculation/the speculative bubble is not irrational. This was never stated by Mackay in the passage. We’re not looking for assumptions, we’re looking for what was explicitly mentioned. Eliminate this answer choice.

P.S. in case anyone is wondering: I looked it up – Mackay wasn’t even an economist

E) Incorrect. Out of scope. The speculative bubble, which Mackay believes to be relevant in this case, has to do with selling an asset at a higher price due to speculation. It has nothing to do with selling the descendants of those assets. If anything, this answer choice has more to do with Garber’s argument than it does Mackay’s. Eliminate this answer choice.

** There is an important distinction to make between “earnings” and “profits” here. More on that in the takeaway/patterns section below.

Takeaway/patterns:

1) As is the case with most reading comp questions, this is like a Must Be True question. We need to be 100% certain that based on the passage, Mackay claimed the correct answer choice. For 100% certainty, we typically want to go with answer choices that user weaker language as it’s easier to prove that than language with stronger logical force. We also want to be able to pick an answer choice that is described in the passage itself.

* 2) The use of the word “determined” might seem a little strong in this answer choice. Can we say that Mackay thought that the increase in prices was determined by speculation and nothing else? Well, actually yes! If you look at the definition of “speculative bubble” in the first paragraph, the author uses the word “mere” to describe how speculation drives the price up of assets. The use of the word "mere" here indicates that speculation is the sole drive of the prices.

Either way, when it comes to the more challenging LSAT questions, sometimes you have to choose an answer that you don't love rather than any of the incorrect ones. LSAC will try to make the correct answer choices unappealing and incorrect answer choices appealing.

** 3) LSAC loves to test our understanding between “earnings” and “profits” as it’s something that can easily trip test takers if they’re not reading the text carefully. It didn’t matter in this case because we were looking for Mackay’s argument as opposed to Garber. But had the question asked for Garber’s argument, answer choice E would have been a contender. Earnings refers to the amount of money generated by selling goods or services. If I sell 2 tulips, each for the price of $25, my earnings would be $50. Profits, on the other hand, refers to the net gain after all expenses are incurred. Let’s continue with my $25 tulip example. Say there’s a tax of $2 per tulip and an additional $3 per tulip of other expenses (buying seeds, labor costs, etc.). Even though I charge $25 for the tulips, I gain a profit of $20 per Tulip for a total profit of $40.

Now let’s take it to the passage. Buyers of rare and expensive Dutch tulip bulbs could make earnings on the descendants of those tulips as long as they at least sold one tulip. So they can be at a net profit loss (because they sold one tulip, for instance) while having positive earnings.

Nonetheless, had the question been about Garber’s argument, I would have eliminated this answer choice still because it’s too strong and broad. There’s nothing in the passage to indicate that every buyer of rare and very expensive Dutch tulip bulbs was able to sell at least one bulb descendant (hence being too strong). The answer choice is broad because it doesn’t mention seventeenth century Dutch tulips. We have no idea, based on the passage presented, what Garber thought about all Dutch tulip bulbs – this question might encompass 16th century Dutch tulips or 19th century Dutch tulips. For Must Be True questions, we generally want answer choices that are as narrow, or narrower, than the scope of the text provided (as long as it’s still relevant to the topic of course).