In the Past, Only India's Elite Could Afford to Buy

question 158

Multiple Choice

In the past, only India's elite could afford to buy a car. But recent dramatic changes in India's economy have produced a growing middle class and rapidly rising incomes. Now, to meet the new demand, established automakers are introducing smaller, more affordable vehicles into India. But they will have to find a way to compete with India's Tata Motors, which has unveiled the least expensive car ever in this market, the Tata Nano. The Nano sells for only 100 000 rupees (about US$2200) . It seats four passengers, gets 50 miles per gallon, and travels at a top speed of 60 miles per hour. Based on the information above, Tata most likely believed that as a result of recent changes in India's economy, what would be true of a growing number of Indian consumers?

• A) They had become even more cost-conscious than ever before.
• B) They would be willing and able to spend 100 000 rupees on a car.
• C) They would choose a vehicle with high fuel efficiency primarily because of concern about the natural environment.
• D) They will eventually prefer models similar to those currently available in the United States and Europe.
• E) They will place a higher value on car safety than fuel economy.