Question

Read the following short passages and answer the questions that follow each passage.
Products sold under a brand name used to command premium prices because, in general, they were superior to non-brand rival products. Technical expertise in product development has become so widespread, however, that special quality advantages are very hard to obtain these days and even harder to maintain. As a consequence, brand-name products generally neither offer higher quality nor sell at higher prices. Paradoxically, brand names are a bigger marketing advantage than ever.
Which of the following, if true, most helps to resolve the paradox outlined above?

Options

• Brand names are taken by consumers as a guarantee of getting a product as good as the best rival product.

• Consumers recognised that the quality of products sold under invariant brand names can drift over time

• In the acquisition of one corporation by another, the acquiring corporation is interested more in acquiring the right to use certain brand names than in acquiring existing production facilities.

• In the earlier days when special quality advantages were easier to obtain than are now, it was also easier to get new brand names established.

Answer 1

Brand names are taken by consumers as a guarantee of getting a product as good as the best rival product.

Explanation:

According to the passage, these days brand-name products neither offer higher quality nor sell at higher prices. Still, brand names provide a bigger marketing advantage. This is because brand names guarantee to provide products that are as good as their rival’s products. Hence, 'Brand names are taken by consumers as a guarantee of getting a product as good as the best rival product.' is the correct answer.