Paradox: "Although average salaries at Company Q increased last year, most employees earned less than they did the previous year." Which resolves this?

The correct answer to the question "Paradox: "Although average salaries at Company Q increased last year, most employees earned less than they did the previous year." Which resolves this?" is Option B: A few top executives received enormous raises that raised the average, while most employees received small pay cuts.

The other options — A) The company hired fewer people, C) Company Q is large, D) Inflation was low last year — are incorrect for this LSAT Exam Prep question. As explained above: This is Simpson's paradox. A few large raises can increase the average while most people experience decreases. The mean is pulled up by outliers.