Question

Which of the following best describes the purpose of the sentence in lines $10-15$?

• A. To show that economic signaling theory fails to explain a finding.
• B. To introduce a distinction not accounted for by economic signaling theory.
• C. To account for an exception to a generalization suggested by Marquardt and McGann.
• D. To explain why Marquardt and McGann's research was conducted.
• E. To offer an explanation for an observation reported by Marquardt and McGann.

Answer 1

The correct option is E To offer an explanation for an observation reported by Marquardt and McGann.

Marquardt and McGann found a correlation between highly advertised products and high quality products. The connection can be explained by understanding that companies may invest heavily in such advertising, anticipating that recurring purchases of high-quality products will eventually recover these advertising costs. The consumers will continue to buy these products over time because of loyalty to their high quality. The statement in bold provides this explanation for the correlation noted by Marquardt and McGann.

A. The sentence does not explain a failure of the economic signaling theory.

B. Economic signaling theory is about perceptions of quality, but this explanation is about actual quality and its correlation with advertising.

C. No exception is mentioned in Marquardt and McGann's work.

D. The sentence does not examine why or how the research was undertaken.

E. Correct. This statement provides an explanation of why highly advertised products did indeed rank high on certain measures of product quality.

The correct answer is E.