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Woodrow Wilson was referring to the liberal idea of the economic market when he said that the free enterprise system is the most efficient economic system. Maximum freedom means maximum productiveness; our openness is to be the measure of our stability. Fascination with this ideal has made Americans defy the Old World categories of settled possessiveness versus unsettling deprivation, the cupidity of retention versus the cupidity of seizure, a status quo defended or attacked. The United States, it was believed, had no status quo ante. Our only station was the turning of a stationary wheel, spinning faster and faster. We did not base our system on property but opportunitywhich meant we based it not on stability but on mobility. The more things changed, that is, the more rapidly the wheel turned, the steadier we would be. The conventional picture of class politics is composed of the Haves, who want a stability to keep what they have, and the Have-Nots, who want a touch of instability and change in which to scramble for the things they have not. But Americans imagined a condition in which speculators, self-makers, runners are always using the new opportunities given by our land. These economic leaders (front-runners) would thus be mainly agents of change. The nonstarters were considered the ones who wanted stability, a strong referee to give them some position in the race, a regulative hand to calm manic speculation; an authority that can call things to a halt, begin things again from compensatorily staggered starting lines.
Reform in America has been sterile because it can imagine no change except through the extension of this metaphor of a race, wider inclusion of competitors, a piece of the action, as it were, for the disenfranchised. There is no attempt to call off the race. Since our only stability is change, America seems not to honor the quiet work that achieves social interdependence and stability. There is, in our legends, no heroism of the office clerk, no stable industrial work force of the people who actually make the system work. There is no pride in being an employee (Wilson asked for a return to the time when everyone was an employer). There has been no boasting about our social workersthey are merely signs of the systems failure, of opportunity denied or not taken, of things to be eliminated. We have no pride in our growing interdependence, in the fact that our system can serve others, that we are able to help those in need; empty boasts from the past make us ashamed of our present achievements, make us try to forget or deny them, move away from them. There is no honor but in the Wonderland race we must all run, all trying to win, none winning in the end (for there is no end).

1.The primary purpose of the passage is to
(A) criticize the inflexibility of American economic mythology
(B) contrast Old World and New World economic ideologies
(C) challenge the integrity of traditional political leaders
(D) champion those Americans whom the author deems to be neglected
(E) suggest a substitute for the traditional metaphor of a race

2.According to the passage, Old World values were based on
(A) ability
(B) property
(C) family connections
(D) guild hierarchies
(E) education

3.In the context of the authors discussion of regulating change, which of the following could be most probably regarded as a strong referee in the United States?
(A) A school principal
(B) A political theorist
(C) A federal court judge
(D) A social worker
(E) A government inspector

4.The author sets off the word Reform with quotation marks in order to
(A) emphasize its departure from the concept of settled possessiveness
(B) show his support for a systematic program of change
(C) underscore the flexibility and even amorphousness of United States society
(D) indicate that the term was one of Wilsons favorites
(E) assert that reform in the United States has not been fundamental

5.It can be inferred from the passage that the author most probably thinks that giving the disenfranchised a piece of the action is
(A) a compassionate, if misdirected, legislative measure
(B) an example of Americans resistance to profound social change
(C) an innovative program for genuine social reform
(D) a monument to the efforts of industrial reformers
(E) a surprisingly Old World remedy for social ills

6.Which of the following metaphors could the author most appropriately use to summarize his own assessment of the American economic system?
(A) A windmill
(B) A waterfall
(C) A treadmill
(D) A gyroscope
(E) A bellows

7.It can be inferred from the passage that Woodrow Wilsons ideas about the economic market
(A) encouraged those who make the system work
(B) perpetuated traditional legends about America
(C) revealed the prejudices of a man born wealthy
(D) foreshadowed the stock market crash of 1929
(E) began a tradition of presidential proclamations on economics

8.The passage contains information that would answer which of the following questions?
I.What techniques have industrialists used to manipulate a free market?
II.In what ways are New World and Old World economic policies similar?
III.Has economic policy in the United States tended to reward independent action?
(A) I only
(B) II only
(C) III only
(D) I and II only
(E) II and III only

9.Which of the following best expresses the authors main point?
(A) Americans pride in their jobs continues to give them stamina today.
(B) The absence of a status quo ante has undermined United States economic structure.
(C) The free enterprise system has been only a useless concept in the United States.
(D) The myth of the American free enterprise system is seriously flawed.
(E) Fascination with the ideal of openness has made Americans a progressive people.

Guys,
I am a newbie here .Will start preparing for the GMAT soon after I am done with the CAT .I am quite comfortable with Quant but I think I'll have tough time on the Verbal section of the GMAT as I have heard it is difficult than the CAT Verbal. Any books you guys would like to suggest for tackling Reading Comprehension on the GMAT .

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OAs are:
B,C,A,D,E,B


Explain please !!!

The fact that superior service can generate a competitive advantage for a company does not mean that every attempt at improving service will create such an advantage. Investments in service, like those in production and distribution, must be balanced against other types of investments on the basis of direct, tangible benefits such as cost reduction and increased revenues. If a company is already effectively on a par with its competitors because it provides service that avoids a damaging reputation and keeps customers from leaving at an unacceptable rate, then investment in higher service levels may be wasted, since service is a deciding factor for customers only in extreme situations.
This truth was not apparent to managers of one regional bank, which failed to improve its competitive position despite its investment in reducing the time a customer had to wait for a teller. The bank managers did not recognize the level of customer inertia in the consumer banking industry that arises from the inconvenience of switching banks. Nor did they analyze their service improvement to determine whether it would attract new customers by producing a new standard of service that would excite customers or by proving difficult for competitors to copy. The only merit of the improvement was that it could easily be described to customers.

1.The primary purpose of the passage is to
(A) contrast possible outcomes of a type of business investment
(B) suggest more careful evaluation of a type of business investment
(C) illustrate various ways in which a type of business investment could fail to enhance revenues
(D) trace the general problems of a company to a certain type of business investment
(E) criticize the way in which managers tend to analyze the costs and benefits of business investments

2.According to the passage, investments in service are comparable to investments in production and distribution in terms of the
(A) tangibility of the benefits that they tend to confer
(B) increased revenues that they ultimately produce
(C) basis on which they need to be weighed
(D) insufficient analysis that managers devote to them
(E) degree of competitive advantage that they are likely to provide

3.The passage suggests which of the following about service provided by the regional bank prior to its investment in enhancing that service?
(A) It enabled the bank to retain customers at an acceptable rate.
(B) It threatened to weaken the banks competitive position with respect to other regional banks.
(C) It had already been improved after having caused damage to the banks reputation in the past.
(D) It was slightly superior to that of the banks regional competitors.
(E) It needed to be improved to attain parity with the service provided by competing banks.

4.The passage suggests that bank managers failed to consider whether or not the service improvement mentioned in line 19
(A) was too complicated to be easily described to prospective customers
(B) made a measurable change in the experiences of customers in the banks offices
(C) could be sustained if the number of customers increased significantly
(D) was an innovation that competing banks could have imitated
(E) was adequate to bring the banks general level of service to a level that was comparable with that of its competitors

5.The discussion of the regional bank (line 7-12) serves which of the following functions within the passage as a whole?
(A) It describes an exceptional case in which investment in service actually failed to produce a competitive advantage.
(B) It illustrates the pitfalls of choosing to invest in service at a time when investment is needed more urgently in another area.
(C) It demonstrates the kind of analysis that managers apply when they choose one kind of service investment over another.
(D) It supports the argument that investments in certain aspects of service are more advantageous than investments in other aspects of service.
(E) It provides an example of the point about investment in service made in the first paragraph.

6.The author uses the word only in line 11 most likely in order to
(A) highlight the oddity of the service improvement
(B) emphasize the relatively low value of the investment in service improvement
(C) distinguish the primary attribute of the service improvement from secondary attributes
(D) single out a certain merit of the service improvement from other merits
(E) point out the limited duration of the actual service improvement
Explain please !!!

The fact that superior service can generate a competitive advantage for a company does not mean that every attempt at improving service will create such an advantage. Investments in service, like those in production and distribution, must be balanced against other types of investments on the basis of direct, tangible benefits such as cost reduction and increased revenues. If a company is already effectively on a par with its competitors because it provides service that avoids a damaging reputation and keeps customers from leaving at an unacceptable rate, then investment in higher service levels may be wasted, since service is a deciding factor for customers only in extreme situations.
This truth was not apparent to managers of one regional bank, which failed to improve its competitive position despite its investment in reducing the time a customer had to wait for a teller. The bank managers did not recognize the level of customer inertia in the consumer banking industry that arises from the inconvenience of switching banks. Nor did they analyze their service improvement to determine whether it would attract new customers by producing a new standard of service that would excite customers or by proving difficult for competitors to copy. The only merit of the improvement was that it could easily be described to customers.

1.The primary purpose of the passage is to
(A) contrast possible outcomes of a type of business investment
(B) suggest more careful evaluation of a type of business investment
(C) illustrate various ways in which a type of business investment could fail to enhance revenues
(D) trace the general problems of a company to a certain type of business investment
(E) criticize the way in which managers tend to analyze the costs and benefits of business investments

2.According to the passage, investments in service are comparable to investments in production and distribution in terms of the
(A) tangibility of the benefits that they tend to confer
(B) increased revenues that they ultimately produce
(C) basis on which they need to be weighed
(D) insufficient analysis that managers devote to them
(E) degree of competitive advantage that they are likely to provide

3.The passage suggests which of the following about service provided by the regional bank prior to its investment in enhancing that service?
(A) It enabled the bank to retain customers at an acceptable rate.
(B) It threatened to weaken the banks competitive position with respect to other regional banks.
(C) It had already been improved after having caused damage to the banks reputation in the past.
(D) It was slightly superior to that of the banks regional competitors.
(E) It needed to be improved to attain parity with the service provided by competing banks.

4.The passage suggests that bank managers failed to consider whether or not the service improvement mentioned in line 19
(A) was too complicated to be easily described to prospective customers
(B) made a measurable change in the experiences of customers in the banks offices
(C) could be sustained if the number of customers increased significantly
(D) was an innovation that competing banks could have imitated
(E) was adequate to bring the banks general level of service to a level that was comparable with that of its competitors

5.The discussion of the regional bank (line 7-12) serves which of the following functions within the passage as a whole?
(A) It describes an exceptional case in which investment in service actually failed to produce a competitive advantage.
(B) It illustrates the pitfalls of choosing to invest in service at a time when investment is needed more urgently in another area.
(C) It demonstrates the kind of analysis that managers apply when they choose one kind of service investment over another.
(D) It supports the argument that investments in certain aspects of service are more advantageous than investments in other aspects of service.
(E) It provides an example of the point about investment in service made in the first paragraph.

6.The author uses the word only in line 11 most likely in order to
(A) highlight the oddity of the service improvement
(B) emphasize the relatively low value of the investment in service improvement
(C) distinguish the primary attribute of the service improvement from secondary attributes
(D) single out a certain merit of the service improvement from other merits
(E) point out the limited duration of the actual service improvement



The passage describes the considerations that are necessary when making investments in the ongoing operations of a business. The point that is made is that one needs to first consider the ROI of a planned investment in terms of its ability to improve customer satisfaction, improve profits or revenue, reduce cost or bring about a disruptive change to the market before making the investment. Or put simply make sure you are solving the right problem :)


Answers to the questions are below

1) B
2) C
3) A
4) D
5) E
6) A

For some handy tips on tackling the AWA, Quantitative and Verbal sections of the GMAT visit College Notepad : Article : GMAT preparation tips
Explain please !!!

The fact that superior service can generate a competitive advantage for a company does not mean that every attempt at improving service will create such an advantage. Investments in service, like those in production and distribution, must be balanced against other types of investments on the basis of direct, tangible benefits such as cost reduction and increased revenues. If a company is already effectively on a par with its competitors because it provides service that avoids a damaging reputation and keeps customers from leaving at an unacceptable rate, then investment in higher service levels may be wasted, since service is a deciding factor for customers only in extreme situations.
This truth was not apparent to managers of one regional bank, which failed to improve its competitive position despite its investment in reducing the time a customer had to wait for a teller. The bank managers did not recognize the level of customer inertia in the consumer banking industry that arises from the inconvenience of switching banks. Nor did they analyze their service improvement to determine whether it would attract new customers by producing a new standard of service that would excite customers or by proving difficult for competitors to copy. The only merit of the improvement was that it could easily be described to customers.

1.The primary purpose of the passage is to
(A) contrast possible outcomes of a type of business investment
(B) suggest more careful evaluation of a type of business investment
(C) illustrate various ways in which a type of business investment could fail to enhance revenues
(D) trace the general problems of a company to a certain type of business investment
(E) criticize the way in which managers tend to analyze the costs and benefits of business investments

2.According to the passage, investments in service are comparable to investments in production and distribution in terms of the
(A) tangibility of the benefits that they tend to confer
(B) increased revenues that they ultimately produce
(C) basis on which they need to be weighed
(D) insufficient analysis that managers devote to them
(E) degree of competitive advantage that they are likely to provide

3.The passage suggests which of the following about service provided by the regional bank prior to its investment in enhancing that service?
(A) It enabled the bank to retain customers at an acceptable rate.
(B) It threatened to weaken the bank's competitive position with respect to other regional banks.
(C) It had already been improved after having caused damage to the bank's reputation in the past.
(D) It was slightly superior to that of the bank's regional competitors.
(E) It needed to be improved to attain parity with the service provided by competing banks.

4.The passage suggests that bank managers failed to consider whether or not the service improvement mentioned in line 19
(A) was too complicated to be easily described to prospective customers
(B) made a measurable change in the experiences of customers in the bank's offices
(C) could be sustained if the number of customers increased significantly
(D) was an innovation that competing banks could have imitated
(E) was adequate to bring the bank's general level of service to a level that was comparable with that of its competitors

5.The discussion of the regional bank (line 7-12) serves which of the following functions within the passage as a whole?
(A) It describes an exceptional case in which investment in service actually failed to produce a competitive advantage.
(B) It illustrates the pitfalls of choosing to invest in service at a time when investment is needed more urgently in another area.
(C) It demonstrates the kind of analysis that managers apply when they choose one kind of service investment over another.
(D) It supports the argument that investments in certain aspects of service are more advantageous than investments in other aspects of service.
(E) It provides an example of the point about investment in service made in the first paragraph.

6.The author uses the word "only" in line 11 most likely in order to
(A) highlight the oddity of the service improvement
(B) emphasize the relatively low value of the investment in service improvement
(C) distinguish the primary attribute of the service improvement from secondary attributes
(D) single out a certain merit of the service improvement from other merits
(E) point out the limited duration of the actual service improvement

For the Reading Comprehension section, it is a good idea to read the first paragraphs of the passage carefully and skim over the rest to gather central idea and the thought flow. Look out for typically misleading options using extreme words like always or never and eliminate these quickly.

College Notepad : Article : GMAT preparation tips

Answers with EXPLANATIONS please
Kindly summarise the ESSENCE, if somebody can
Thanks.


Recent years have brought minority-owned businesses in the United States unprecedented opportunitiesas well as new and significant risks. Civil rights activists have long argued that one of the principal reasons why Blacks, Hispanics, and other minority groups have difficulty establishing themselves in business is that they lack access to the sizable orders and subcontracts that are generated by large companies. Now Congress, in apparent agreement, has required by law that businesses awarded federal contracts of more than $500,000 do their best to find minority subcontractors and record their efforts to do so on forms filed with the government. Indeed, some federal and local agencies have gone so far as to set specific percentage goals for apportioning parts of public works contracts to minority enterprises.
Corporate response appears to have been substantial. According to figures collected in 1977, the total of corporate contracts with minority businesses rose from $77 million in 1972 to $1.1 billion in 1977. The projected total of corporate contracts with minority businesses for the early 1980s is estimated to be over 53 billion per year with no letup anticipated in the next decade. Promising as it is for minority businesses, this increased patronage poses dangers for them, too. First, minority firms risk expanding too fast and overextending themselves financially, since most are small concerns and, unlike large businesses, they often need to make substantial investments in new plants, staff, equipment, and the like in order to perform work subcontracted to them. If, thereafter, their subcontracts are for some reason reduced, such firms can face potentially crippling fixed expenses. The world of corporate purchasing can be frustrating for small entrepreneurs who get requests for elaborate formal estimates and bids. Both consume valuable time and resources, and a small companys efforts must soon result in orders, or both the morale and the financial health of the business will suffer.
A second risk is that White-owned companies may seek to cash in on the increasing apportionments through formation of joint ventures with minority-owned concerns. Of course, in many instances there are legitimate reasons for joint ventures; clearly, White and minority enterprises can team up to acquire business that neither could acquire alone. But civil rights groups and minority business owners have complained to Congress about minorities being set up as fronts with White backing, rather than being accepted as full partners in legitimate joint ventures.
Third, a minority enterprise that secures the business of one large corporate customer often runs the danger of becomingand remainingdependent. Even in the best of circumstances, fierce competition from larger, more established companies makes it difficult for small concerns to broaden their customer bases: when such firms have nearly guaranteed orders from a single corporate benefactor, they may truly have to struggle against complacency arising from their current success.

1. The primary purpose of the passage is to
(A) present a commonplace idea and its inaccuracies
(B) describe a situation and its potential drawbacks
(C) propose a temporary solution to a problem
(D) analyze a frequent source of disagreement
(E) explore the implications of a finding

2. The passage supplies information that would answer which of the following questions?
(A) What federal agencies have set percentage goals for the use of minority-owned businesses in public works contracts?
(B) To which government agencies must businesses awarded federal contracts report their efforts to find minority subcontractors?
(C) How widespread is the use of minority-owned concerns as fronts by White backers seeking to obtain subcontracts?
(D) How many more minority-owned businesses were there in 1977 than in 1972?
(E) What is one set of conditions under which a small business might find itself financially overextended?

3. According to the passage, civil rights activists maintain that one disadvantage under which minority-owned businesses have traditionally had to labor is that they have
(A) been especially vulnerable to governmental mismanagement of the economy
(B) been denied bank loans at rates comparable to those afforded larger competitors
(C) not had sufficient opportunity to secure business created by large corporations
(D) not been able to advertise in those media that reach large numbers of potential customers
(E) not had adequate representation in the centers of government power

4. The passage suggests that the failure of a large business to have its bids for subcontracts result quickly in orders might cause it to
(A) experience frustration but not serious financial harm
(B) face potentially crippling fixed expenses
(C) have to record its efforts on forms filed with the government
(D) increase its spending with minority subcontractors
(E) revise its procedure for making bids for federal contracts and subcontracts

5. The author implies that a minority-owned concern that does the greater part of its business with one large corporate customer should
(A) avoid competition with larger, more established concerns by not expanding
(B) concentrate on securing even more business from that corporation
(C) try to expand its customer base to avoid becoming dependent on the corporation
(D) pass on some of the work to be done for the corporation to other minority-owned concerns
(E) use its influence with the corporation to promote subcontracting with other minority concerns

6. It can be inferred from the passage that, compared with the requirements of law, the percentage goals set by some federal and local agencies (lines 14-15) are
(A) more popular with large corporations
(B) more specific
(C) less controversial
(D) less expensive to enforce
(E) easier to comply with

7. Which of the following, if true, would most weaken the authors assertion that, in the 1970s, corporate response to federal requirements (lines 18-19) was substantial
(A) Corporate contracts with minority-owned businesses totaled $2 billion in 1979.
(B) Between 1970 and 1972, corporate contracts with minority-owned businesses declined by 25 percent.
(C) The figures collected in 1977 underrepresented the extent of corporate contracts with minority-owned businesses.
(D) The estimate of corporate spending with minority-owned businesses in 1980 is approximately $10 million too high.
(E) The $1.1 billion represented the same percentage of total corporate spending in 1977 as did $77 million in 1972.

8. The author would most likely agree with which of the following statements about corporate response to working with minority subcontractors?
(A) Annoyed by the proliferation of front organizations, corporations are likely to reduce their efforts to work with minority-owned subcontractors in the near future.
(B) Although corporations showed considerable interest in working with minority businesses in the 1970s, their aversion to government paperwork made them reluctant to pursue many government contracts.
(C) The significant response of corporations in the 1970s is likely to be sustained and conceivably be increased throughout the 1980s.
(D) Although corporations are eager to cooperate with minority-owned businesses, a shortage of capital in the 1970s made substantial response impossible.

hi friends,
i need some suggestions:

I am doing RC from OG Verbal these days and finding it quite difficult....the accuracy is almost 50%. it was not that bad when i did OG 12.
i feel, even though the passage looks small and easy to understand, the questions it has are even more difficult to understand.

I am really disappointed with my RC and it is daunting me.
i have already booked the date of gmat:6th dec.
i have almost no confidence while solving RCs.

guys please suggest something...

I will go with option B. First para talks about huv TQM can work with other 2 management systems whereas second para talks about huv TQM is a tad diff from other 2 management systems.

-Deepak.


The OA is C. Even I marked B.
Can someone explain.
Gail.Wynand Says
Attached is a RC question from MBA.com GMATPrep test. Please post your explanations.


I will go with option B. First para talks about huv TQM can work with other 2 management systems whereas second para talks about huv TQM is a tad diff from other 2 management systems.

-Deepak.
Attached is a RC question from MBA.com GMATPrep test. Please post your explanations.

No takers yet ???


Answers with EXPLANATIONS please :)
Kindly summarise the ESSENCE, if somebody can :)
Thanks.

Recent years have brought minority-owned businesses in the United States unprecedented opportunitiesas well as new and significant risks. Civil rights activists have long argued that one of the principal reasons why Blacks, Hispanics, and other minority groups have difficulty establishing themselves in business is that they lack access to the sizable orders and subcontracts that are generated by large companies. Now Congress, in apparent agreement, has required by law that businesses awarded federal contracts of more than $500,000 do their best to find minority subcontractors and record their efforts to do so on forms filed with the government. Indeed, some federal and local agencies have gone so far as to set specific percentage goals for apportioning parts of public works contracts to minority enterprises.
Corporate response appears to have been substantial. According to figures collected in 1977, the total of corporate contracts with minority businesses rose from $77 million in 1972 to $1.1 billion in 1977. The projected total of corporate contracts with minority businesses for the early 1980s is estimated to be over 53 billion per year with no letup anticipated in the next decade. Promising as it is for minority businesses, this increased patronage poses dangers for them, too. First, minority firms risk expanding too fast and overextending themselves financially, since most are small concerns and, unlike large businesses, they often need to make substantial investments in new plants, staff, equipment, and the like in order to perform work subcontracted to them. If, thereafter, their subcontracts are for some reason reduced, such firms can face potentially crippling fixed expenses. The world of corporate purchasing can be frustrating for small entrepreneurs who get requests for elaborate formal estimates and bids. Both consume valuable time and resources, and a small companys efforts must soon result in orders, or both the morale and the financial health of the business will suffer.
A second risk is that White-owned companies may seek to cash in on the increasing apportionments through formation of joint ventures with minority-owned concerns. Of course, in many instances there are legitimate reasons for joint ventures; clearly, White and minority enterprises can team up to acquire business that neither could acquire alone. But civil rights groups and minority business owners have complained to Congress about minorities being set up as fronts with White backing, rather than being accepted as full partners in legitimate joint ventures.
Third, a minority enterprise that secures the business of one large corporate customer often runs the danger of becomingand remainingdependent. Even in the best of circumstances, fierce competition from larger, more established companies makes it difficult for small concerns to broaden their customer bases: when such firms have nearly guaranteed orders from a single corporate benefactor, they may truly have to struggle against complacency arising from their current success.


1.The primary purpose of the passage is to
(A) present a commonplace idea and its inaccuracies
(B) describe a situation and its potential drawbacks
(C) propose a temporary solution to a problem
(D) analyze a frequent source of disagreement
(E) explore the implications of a finding

2.The passage supplies information that would answer which of the following questions?
(A) What federal agencies have set percentage goals for the use of minority-owned businesses in public works contracts?
(B) To which government agencies must businesses awarded federal contracts report their efforts to find minority subcontractors?
(C) How widespread is the use of minority-owned concerns as fronts by White backers seeking to obtain subcontracts?
(D) How many more minority-owned businesses were there in 1977 than in 1972?
(E) What is one set of conditions under which a small business might find itself financially overextended?

3.According to the passage, civil rights activists maintain that one disadvantage under which minority-owned businesses have traditionally had to labor is that they have
(A) been especially vulnerable to governmental mismanagement of the economy
(B) been denied bank loans at rates comparable to those afforded larger competitors
(C) not had sufficient opportunity to secure business created by large corporations
(D) not been able to advertise in those media that reach large numbers of potential customers
(E) not had adequate representation in the centers of government power

4.The passage suggests that the failure of a large business to have its bids for subcontracts result quickly in orders might cause it to
(A) experience frustration but not serious financial harm
(B) face potentially crippling fixed expenses
(C) have to record its efforts on forms filed with the government
(D) increase its spending with minority subcontractors
(E) revise its procedure for making bids for federal contracts and subcontracts

5.The author implies that a minority-owned concern that does the greater part of its business with one large corporate customer should
(A) avoid competition with larger, more established concerns by not expanding
(B) concentrate on securing even more business from that corporation
(C) try to expand its customer base to avoid becoming dependent on the corporation
(D) pass on some of the work to be done for the corporation to other minority-owned concerns
(E) use its influence with the corporation to promote subcontracting with other minority concerns

6.It can be inferred from the passage that, compared with the requirements of law, the percentage goals set by some federal and local agencies (lines 14-15) are
(A) more popular with large corporations
(B) more specific
(C) less controversial
(D) less expensive to enforce
(E) easier to comply with

7.Which of the following, if true, would most weaken the authors assertion that, in the 1970s, corporate response to federal requirements (lines 18-19) was substantial
(A) Corporate contracts with minority-owned businesses totaled $2 billion in 1979.
(B) Between 1970 and 1972, corporate contracts with minority-owned businesses declined by 25 percent.
(C) The figures collected in 1977 underrepresented the extent of corporate contracts with minority-owned businesses.
(D) The estimate of corporate spending with minority-owned businesses in 1980 is approximately $10 million too high.
(E) The $1.1 billion represented the same percentage of total corporate spending in 1977 as did $77 million in 1972.

8.The author would most likely agree with which of the following statements about corporate response to working with minority subcontractors?
(A) Annoyed by the proliferation of front organizations, corporations are likely to reduce their efforts to work with minority-owned subcontractors in the near future.
(B) Although corporations showed considerable interest in working with minority businesses in the 1970s, their aversion to government paperwork made them reluctant to pursue many government contracts.
(C) The significant response of corporations in the 1970s is likely to be sustained and conceivably be increased throughout the 1980s.
(D) Although corporations are eager to cooperate with minority-owned businesses, a shortage of capital in the 1970s made substantial response impossible.

Good tips Mukul...
I feel that GMAT is just the first stop in the journey, not the destination itself.
Therefore, just following a set of steps and rehearsing them for a short period of time isnt really the best thing. Make reading and writing a habit, so that you are prepared for the challenges which pose themselves in days, months or even years ahead.

I am also taking the GMAT in another 3 days....having prepared for almost a month now...

And to make myself comfortable with passages, essays and to be able to focus more, i have resorted to blogging. I do feel that along with reading newspapers, journals, magazines and novels, blogging is an awesome method of improving ones vocabulary, critical reasoning, concentration and patience.

Am also writing few lines about my preparation on my blogpage. Link to it is given below :
Insomnia

No takers???

Answers with EXPLANATIONS please :)
Kindly summarise the ESSENCE, if somebody can :)
Thanks.

Recent years have brought minority-owned businesses in the United States unprecedented opportunitiesas well as new and significant risks. Civil rights activists have long argued that one of the principal reasons why Blacks, Hispanics, and other minority groups have difficulty establishing themselves in business is that they lack access to the sizable orders and subcontracts that are generated by large companies. Now Congress, in apparent agreement, has required by law that businesses awarded federal contracts of more than $500,000 do their best to find minority subcontractors and record their efforts to do so on forms filed with the government. Indeed, some federal and local agencies have gone so far as to set specific percentage goals for apportioning parts of public works contracts to minority enterprises.
Corporate response appears to have been substantial. According to figures collected in 1977, the total of corporate contracts with minority businesses rose from $77 million in 1972 to $1.1 billion in 1977. The projected total of corporate contracts with minority businesses for the early 1980s is estimated to be over 53 billion per year with no letup anticipated in the next decade. Promising as it is for minority businesses, this increased patronage poses dangers for them, too. First, minority firms risk expanding too fast and overextending themselves financially, since most are small concerns and, unlike large businesses, they often need to make substantial investments in new plants, staff, equipment, and the like in order to perform work subcontracted to them. If, thereafter, their subcontracts are for some reason reduced, such firms can face potentially crippling fixed expenses. The world of corporate purchasing can be frustrating for small entrepreneurs who get requests for elaborate formal estimates and bids. Both consume valuable time and resources, and a small companys efforts must soon result in orders, or both the morale and the financial health of the business will suffer.
A second risk is that White-owned companies may seek to cash in on the increasing apportionments through formation of joint ventures with minority-owned concerns. Of course, in many instances there are legitimate reasons for joint ventures; clearly, White and minority enterprises can team up to acquire business that neither could acquire alone. But civil rights groups and minority business owners have complained to Congress about minorities being set up as fronts with White backing, rather than being accepted as full partners in legitimate joint ventures.
Third, a minority enterprise that secures the business of one large corporate customer often runs the danger of becomingand remainingdependent. Even in the best of circumstances, fierce competition from larger, more established companies makes it difficult for small concerns to broaden their customer bases: when such firms have nearly guaranteed orders from a single corporate benefactor, they may truly have to struggle against complacency arising from their current success.


1.The primary purpose of the passage is to
(A) present a commonplace idea and its inaccuracies
(B) describe a situation and its potential drawbacks
(C) propose a temporary solution to a problem
(D) analyze a frequent source of disagreement
(E) explore the implications of a finding

2.The passage supplies information that would answer which of the following questions?
(A) What federal agencies have set percentage goals for the use of minority-owned businesses in public works contracts?
(B) To which government agencies must businesses awarded federal contracts report their efforts to find minority subcontractors?
(C) How widespread is the use of minority-owned concerns as fronts by White backers seeking to obtain subcontracts?
(D) How many more minority-owned businesses were there in 1977 than in 1972?
(E) What is one set of conditions under which a small business might find itself financially overextended?

3.According to the passage, civil rights activists maintain that one disadvantage under which minority-owned businesses have traditionally had to labor is that they have
(A) been especially vulnerable to governmental mismanagement of the economy
(B) been denied bank loans at rates comparable to those afforded larger competitors
(C) not had sufficient opportunity to secure business created by large corporations
(D) not been able to advertise in those media that reach large numbers of potential customers
(E) not had adequate representation in the centers of government power

4.The passage suggests that the failure of a large business to have its bids for subcontracts result quickly in orders might cause it to
(A) experience frustration but not serious financial harm
(B) face potentially crippling fixed expenses
(C) have to record its efforts on forms filed with the government
(D) increase its spending with minority subcontractors
(E) revise its procedure for making bids for federal contracts and subcontracts

5.The author implies that a minority-owned concern that does the greater part of its business with one large corporate customer should
(A) avoid competition with larger, more established concerns by not expanding
(B) concentrate on securing even more business from that corporation
(C) try to expand its customer base to avoid becoming dependent on the corporation
(D) pass on some of the work to be done for the corporation to other minority-owned concerns
(E) use its influence with the corporation to promote subcontracting with other minority concerns

6.It can be inferred from the passage that, compared with the requirements of law, the percentage goals set by some federal and local agencies (lines 14-15) are
(A) more popular with large corporations
(B) more specific
(C) less controversial
(D) less expensive to enforce
(E) easier to comply with

7.Which of the following, if true, would most weaken the authors assertion that, in the 1970s, corporate response to federal requirements (lines 18-19) was substantial
(A) Corporate contracts with minority-owned businesses totaled $2 billion in 1979.
(B) Between 1970 and 1972, corporate contracts with minority-owned businesses declined by 25 percent.
(C) The figures collected in 1977 underrepresented the extent of corporate contracts with minority-owned businesses.
(D) The estimate of corporate spending with minority-owned businesses in 1980 is approximately $10 million too high.
(E) The $1.1 billion represented the same percentage of total corporate spending in 1977 as did $77 million in 1972.

8.The author would most likely agree with which of the following statements about corporate response to working with minority subcontractors?
(A) Annoyed by the proliferation of front organizations, corporations are likely to reduce their efforts to work with minority-owned subcontractors in the near future.
(B) Although corporations showed considerable interest in working with minority businesses in the 1970s, their aversion to government paperwork made them reluctant to pursue many government contracts.
(C) The significant response of corporations in the 1970s is likely to be sustained and conceivably be increased throughout the 1980s.
(D) Although corporations are eager to cooperate with minority-owned businesses, a shortage of capital in the 1970s made substantial response impossible.
Answers with EXPLANATIONS please :)
Kindly summarise the ESSENCE, if somebody can :)
Thanks.

Recent years have brought minority-owned businesses in the United States unprecedented opportunitiesas well as new and significant risks. Civil rights activists have long argued that one of the principal reasons why Blacks, Hispanics, and other minority groups have difficulty establishing themselves in business is that they lack access to the sizable orders and subcontracts that are generated by large companies. Now Congress, in apparent agreement, has required by law that businesses awarded federal contracts of more than $500,000 do their best to find minority subcontractors and record their efforts to do so on forms filed with the government. Indeed, some federal and local agencies have gone so far as to set specific percentage goals for apportioning parts of public works contracts to minority enterprises.
Corporate response appears to have been substantial. According to figures collected in 1977, the total of corporate contracts with minority businesses rose from $77 million in 1972 to $1.1 billion in 1977. The projected total of corporate contracts with minority businesses for the early 1980s is estimated to be over 53 billion per year with no letup anticipated in the next decade. Promising as it is for minority businesses, this increased patronage poses dangers for them, too. First, minority firms risk expanding too fast and overextending themselves financially, since most are small concerns and, unlike large businesses, they often need to make substantial investments in new plants, staff, equipment, and the like in order to perform work subcontracted to them. If, thereafter, their subcontracts are for some reason reduced, such firms can face potentially crippling fixed expenses. The world of corporate purchasing can be frustrating for small entrepreneurs who get requests for elaborate formal estimates and bids. Both consume valuable time and resources, and a small companys efforts must soon result in orders, or both the morale and the financial health of the business will suffer.
A second risk is that White-owned companies may seek to cash in on the increasing apportionments through formation of joint ventures with minority-owned concerns. Of course, in many instances there are legitimate reasons for joint ventures; clearly, White and minority enterprises can team up to acquire business that neither could acquire alone. But civil rights groups and minority business owners have complained to Congress about minorities being set up as fronts with White backing, rather than being accepted as full partners in legitimate joint ventures.
Third, a minority enterprise that secures the business of one large corporate customer often runs the danger of becomingand remainingdependent. Even in the best of circumstances, fierce competition from larger, more established companies makes it difficult for small concerns to broaden their customer bases: when such firms have nearly guaranteed orders from a single corporate benefactor, they may truly have to struggle against complacency arising from their current success.


1.The primary purpose of the passage is to
(A) present a commonplace idea and its inaccuracies
(B) describe a situation and its potential drawbacks
(C) propose a temporary solution to a problem
(D) analyze a frequent source of disagreement
(E) explore the implications of a finding

2.The passage supplies information that would answer which of the following questions?
(A) What federal agencies have set percentage goals for the use of minority-owned businesses in public works contracts?
(B) To which government agencies must businesses awarded federal contracts report their efforts to find minority subcontractors?
(C) How widespread is the use of minority-owned concerns as fronts by White backers seeking to obtain subcontracts?
(D) How many more minority-owned businesses were there in 1977 than in 1972?
(E) What is one set of conditions under which a small business might find itself financially overextended?

3.According to the passage, civil rights activists maintain that one disadvantage under which minority-owned businesses have traditionally had to labor is that they have
(A) been especially vulnerable to governmental mismanagement of the economy
(B) been denied bank loans at rates comparable to those afforded larger competitors
(C) not had sufficient opportunity to secure business created by large corporations
(D) not been able to advertise in those media that reach large numbers of potential customers
(E) not had adequate representation in the centers of government power

4.The passage suggests that the failure of a large business to have its bids for subcontracts result quickly in orders might cause it to
(A) experience frustration but not serious financial harm
(B) face potentially crippling fixed expenses
(C) have to record its efforts on forms filed with the government
(D) increase its spending with minority subcontractors
(E) revise its procedure for making bids for federal contracts and subcontracts

5.The author implies that a minority-owned concern that does the greater part of its business with one large corporate customer should
(A) avoid competition with larger, more established concerns by not expanding
(B) concentrate on securing even more business from that corporation
(C) try to expand its customer base to avoid becoming dependent on the corporation
(D) pass on some of the work to be done for the corporation to other minority-owned concerns
(E) use its influence with the corporation to promote subcontracting with other minority concerns

6.It can be inferred from the passage that, compared with the requirements of law, the percentage goals set by some federal and local agencies (lines 14-15) are
(A) more popular with large corporations
(B) more specific
(C) less controversial
(D) less expensive to enforce
(E) easier to comply with

7.Which of the following, if true, would most weaken the authors assertion that, in the 1970s, corporate response to federal requirements (lines 18-19) was substantial
(A) Corporate contracts with minority-owned businesses totaled $2 billion in 1979.
(B) Between 1970 and 1972, corporate contracts with minority-owned businesses declined by 25 percent.
(C) The figures collected in 1977 underrepresented the extent of corporate contracts with minority-owned businesses.
(D) The estimate of corporate spending with minority-owned businesses in 1980 is approximately $10 million too high.
(E) The $1.1 billion represented the same percentage of total corporate spending in 1977 as did $77 million in 1972.

8.The author would most likely agree with which of the following statements about corporate response to working with minority subcontractors?
(A) Annoyed by the proliferation of front organizations, corporations are likely to reduce their efforts to work with minority-owned subcontractors in the near future.
(B) Although corporations showed considerable interest in working with minority businesses in the 1970s, their aversion to government paperwork made them reluctant to pursue many government contracts.
(C) The significant response of corporations in the 1970s is likely to be sustained and conceivably be increased throughout the 1980s.
(D) Although corporations are eager to cooperate with minority-owned businesses, a shortage of capital in the 1970s made substantial response impossible.

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