Q6 - The construction of new apartments in Brewsterville

[ohthatpatrick]

Question Type:
Explain the Surprise

Stimulus Breakdown:
Making more apt's in B led to more supply of available housing. Usually, more supply of available housing leads to lower rest for existing apt's. But rents for existing apt's went up.

Answer Anticipation:
GIVEN THAT we'd expect lower rents for existing apt's
WHY IS IT THAT the rents for existing apt's went up?

Correct Answer:
E

Answer Choice Analysis:
(A) There's still an increase in supply, so there should still be an decrease in rent at existing apt's.

(B) Still an increase in supply, so why not a decrease in rent at existing apt's

(C) Maybe? Why would lower rent in a nearby area mean HIGHER rents for existing apt's in B?

(D) That's even MORE housing supply, so I'm even MORE expecting a lowering of rent for existing apt's.

(E) YES! There is more demand for housing in B. More demand leads to higher prices. Ordinarily, more supply leads to lower prices, but in this case, apparently the increase in demand was stronger than the increase in supply.

Takeaway/Pattern: This answer choice demands that we have real world knowledge of the causal connection between supply/demand and price. That is definitely something that is fair game in "LSAT Common Sense".

#officialexplanation