Question

Platinum is a relatively rare metal vital to a wide variety of industries. Xagor Corporation, a major producer of platinum, has its production plant in a country that will soon begin imposing an export tax on platinum sold and shipped to customers abroad. As a consequence, the price of platinum on the world market is bound to rise.

Which of the following, if true, tends to confirm the conclusion above?A. An inexpensive substitute for platinum has been developed and will be available to industry for the first time this month.B. The largest of the industries that depend on platinum reported a drop in sales last month.C. The producers of platinum in other countries taken together cannot supply enough platinum to meet worldwide demand.D. Xagor produced more platinum last month than in any previous month.E. New deposits of platinum have been found in the country in which Xagor has its production plant.

Answer 1

The correct answer is option C.

Step-by-step explanation:

Platinum is a relatively rare metal vital to a wide variety of industries.

Xagor Corporation, a major producer of platinum, has its production plant in a country. The country is going to impose an export tax on platinum sold and shipped to customers abroad. This will cause the world price of platinum to increase.

This is possible because of the scarcity of platinum. The production and supply of platinum from other countries are not able to meet the global demand for platinum. An export tax will increase the price of platinum in the country. Since the other countries are taken together cannot meet the worldwide demand. The world price will rise as well.