11th October, 2016 (CSAT)


Directions : In the below questions, four alternative summaries are given below each text. Choose the option that best captures the essence of the text.

1. Most large retail stores of all goods and brands hold discount sales in the month of November. The original idea of price reduction campaigns in November became popular when it was realized that the sales of products would generally slow down following the Diwali rush. The lack of demand could be solved by the simple solution of reducing prices. There is now an increasing tendency among major chains of stores across the country to have their “November sales” begin before Diwali. The idea behind this trend is to endeavour to sell the maximum amount of stock at a profit, even if that may not be at the maximum profit.

Which of the following conclusions cannot be drawn from the above?

(a) The incidence of “early” November sales results in lower holdings of stocks with the corollary of lower stock holding costs.

(b) Demand is a function of price; as you lower price, demand increases.

(c) Major stores seem to think it makes sense to have the November sales campaigns pre-Diwali.

(d) The major department stores do not worry as much about profit maximization as they do about sales maximization.


2. The argument for liberalisation which answers the worries of the Left parties about the possible trade deficits created by the opening up of the Indian economy goes thus: ‘In today’s economic scenario, where there are many trading countries, the trade between two specific countries need not be balanced. The differing demands of goods and services and the differing productive capabilities of the same among different countries will cause a country like India to have trade deficits with some countries and surpluses with other countries. On the whole, the trade deficits and surpluses will balance out in order to give a trade balance’.

Which of the following conclusions best summarises the argument presented in the passage above?

(a) Left parties need not worry about trade deficits in India since its trade will always be in balance even though it runs a deficit with a single country.

(b) India’s trade deficits and surpluses with other countries always balance out.

(c) The Left parties in India should not be concerned about India’s trade deficits with specific countries because they will balance out in the long run.

(d) None of these

Tomorrow: Next questions for practice

For previous questions refer yesterday’s post

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