Read the following passage and answer the questions.
Gender-based pricing, also known as “pink tax,” is an upcharge on products traditionally intended for women which have only cosmetic differences from comparable products traditionally intended for men. In other words, it’s not actually a tax. It’s an “income-generating scenario for private companies who found a way to make their product look either more directed to or more appropriate for the population and saw that as a moneymaker,” explains Jennifer Weiss-Wolf, a lawyer, vice president for the Brennan School of Justice at NYU School of Law, and co-founder of Period Equity
Yet pink tax is not a new phenomenon. The issue was delineated more finely in 2015 when the New York City Department of Consumer Affairs released a report about price disparities for 794 comparable products from 91 brands sold throughout the city. The report examined five different industries, such as personal care products or senior/home healthcare products. These encompassed 35 product categories, such as bodywash or shampoo. In every single of those five industries, consumer goods marketed to women and girls cost more. The same was the case in all but five of the 35 product categories. Researchers looked at 106 products in the toys and accessories category and found that, on average, those intended for girls were priced 7 percent higher.
NYC’s report found women faced an average price difference of 13 percent for personal care products among the 122 products compared in the study. And the authors aptly noted that these items, such as shaving gel and deodorant, are the ones purchased most frequently compared with other categories — meaning that the ____________ add up over time. While this is unfair for all those shopping for these products, that 13 percent price increase hits women and girls who come from lower income households even harder. Legislative attempts, however, could correct the pink tax. In 1995, then-Assemblywoman Jackie Speier successfully passed a bill that forbade gender pricing of services, such as haircuts.
What is the motive behind the imposition of the "pink tax"?
Correct Answer :
Companies believe that they can capitalize from perceived gender-based branding differences.
Solution :
Based on the provided passage, the correct answer is: Companies believe that they can capitalize from perceived gender-based branding differences.
Step-by-step Explanation:
1. Locate key terms: The question asks about the motive behind the imposition of the "pink tax." We need to find where the passage explains the reason or purpose behind this pricing strategy.
2. Analyze the passage content: The first paragraph of the passage defines gender-based pricing ("pink tax") as an upcharge on products traditionally intended for women. It explicitly states that it is not a real tax, but rather:
"an 'income-generating scenario for private companies who found a way to make their product look either more directed to or more appropriate for the population and saw that as a moneymaker...'"
3. Connect to the options: The phrase "income-generating scenario" and seeing it "as a moneymaker" by making products look more directed to a specific population corresponds directly to the idea of companies capitalizing (making money) from perceived branding differences targeted at different genders. Therefore, the motive is that companies believe they can capitalize on these gender-based branding differences.
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