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Deregulation of electricity markets in the United States has

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Deregulation of electricity markets in the United States has [#permalink] New post 23 May 2010, 10:31
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Deregulation of electricity markets in the United States has resulted in supply disruptions and in higher prices for consumers. Properly understood, however, this phenomenon does not cast doubt on the economic principle that free-market competition is generally more efficient than state planning. Certain particularities of electricity as a commodity - including the impossibility of storing electricity, the inelasticity of demand for electricity, and the high barriers to entry for new producers - are peculiar obstacles to the creation of competitive electricity markets.

In the above argument, the two portions in boldface play which of the following roles?

A.The first is a historical claim that the author rejects; the second is the theoretical basis for his rejection of that claim.
B.The first describes an apparent exception to a theory that the author accepts as true; the second is that theory.
C.The first is the basis for the author's critique of conventional economics; the second is his summary of conventional economic thought.
D.The first describes an event that the author believes to be unusual; the second is the author's explanation of why this unusual event occured.
E.The first is a particular example of a broader trend; the second is that trend.
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Re: [CR] Market Deregulation [#permalink] New post 23 May 2010, 11:37
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sh00nya wrote:
Deregulation of electricity markets in the United States has resulted in supply disruptions and in higher prices for consumers. Properly understood, however, this phenomenon does not cast doubt on the economic principle that free-market competition is generally more efficient than state planning. Certain particularities of electricity as a commodity - including the impossibility of storing electricity, the inelasticity of demand for electricity, and the high barriers to entry for new producers - are peculiar obstacles to the creation of competitive electricity markets.

In the above argument, the two portions in boldface play which of the following roles?

A.The first is a historical claim that the author rejects; the second is the theoretical basis for his rejection of that claim.>>> First statement is not a "historical claim".
B.The first describes an apparent exception to a theory that the author accepts as true; the second is that theory. >>> IMO, Correct
C.The first is the basis for the author's critique of conventional economics; the second is his summary of conventional economic thought. >>> Nothing has been said about conventional economics
D.The first describes an event that the author believes to be unusual; the second is the author's explanation of why this unusual event occured. >>> Second is a generalization/theory
E.The first is a particular example of a broader trend; the second is that trend.>>> First is an unusual example..


OA plz.
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Re: [CR] Market Deregulation [#permalink] New post 24 May 2010, 00:03
I vote for B. What's OA?
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Re: [CR] Market Deregulation [#permalink] New post 24 May 2010, 02:34
IMO C

A.The first is a historical claim that the author rejects; the second is the theoretical basis for his rejection of that claim. the first boldface is not rejected by the author
B.The first describes an apparent exception to a theory that the author accepts as true; the second is that theory. the first boldface is not an exception to a theory as author states that in the second sentence
C.The first is the basis for the author's critique of conventional economics; the second is his summary of conventional economic thought. Correct
D.The first describes an event that the author believes to be unusual; the second is the author's explanation of why this unusual event occured.
Close contender for Correct answer. However, I don't think the author finds the even unusual
E.The first is a particular example of a broader trend; the second is that trend.[/quote]
The first is not a trend
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Re: [CR] Market Deregulation [#permalink] New post 24 May 2010, 19:50
Can you please post the OA ?
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Re: [CR] Market Deregulation [#permalink] New post 24 May 2010, 20:16
OA is B
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Re: [CR] Market Deregulation [#permalink] New post 26 May 2010, 12:15
Is my analysis correct????

The theory is " free-market competition is generally more efficient than state planning" ===> meaning ==> state regulated (state planning) ==> no competition ==> hence less efficient

In U.S. ==> deregulation (no state regulation) has managed the competition (which is an exception to the theory)

Hence B.
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Re: [CR] Market Deregulation [#permalink] New post 27 May 2010, 00:48
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sh00nya wrote:
Deregulation of electricity markets in the United States has resulted in supply disruptions and in higher prices for consumers. Properly understood, however, this phenomenon does not cast doubt on the economic principle that free-market competition is generally more efficient than state planning. Certain particularities of electricity as a commodity - including the impossibility of storing electricity, the inelasticity of demand for electricity, and the high barriers to entry for new producers - are peculiar obstacles to the creation of competitive electricity markets.

In the above argument, the two portions in boldface play which of the following roles?

A.The first is a historical claim that the author rejects; the second is the theoretical basis for his rejection of that claim.
B.The first describes an apparent exception to a theory that the author accepts as true; the second is that theory.
C.The first is the basis for the author's critique of conventional economics; the second is his summary of conventional economic thought.
D.The first describes an event that the author believes to be unusual; the second is the author's explanation of why this unusual event occured.
E.The first is a particular example of a broader trend; the second is that trend.


Tip on Bold-face questions: Do not try to formulate a relationship between the two portions in bold!! Instead, your job is to track the relationship between each sentence/clause and the preceding sentence.

Thus, the first sentence (in bold) says that deregulation made the electricity market (specific) inefficient.

The second sentence (note the 'however') says that this specific case does not cast doubt on a general principle-- just the principle is in bold! Interpretation: The author is not critiquing the principle.

The remainder of the argument explains why the principle still holds despite the exceptional case.

Answer: B indeed!

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Re: [CR] Market Deregulation [#permalink] New post 12 Sep 2011, 09:06
B
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Re: [CR] Market Deregulation [#permalink] New post 11 Oct 2011, 05:30
thanks for this! :-D

SaraiGMAXonline wrote:
sh00nya wrote:
Deregulation of electricity markets in the United States has resulted in supply disruptions and in higher prices for consumers. Properly understood, however, this phenomenon does not cast doubt on the economic principle that free-market competition is generally more efficient than state planning. Certain particularities of electricity as a commodity - including the impossibility of storing electricity, the inelasticity of demand for electricity, and the high barriers to entry for new producers - are peculiar obstacles to the creation of competitive electricity markets.

In the above argument, the two portions in boldface play which of the following roles?

A.The first is a historical claim that the author rejects; the second is the theoretical basis for his rejection of that claim.
B.The first describes an apparent exception to a theory that the author accepts as true; the second is that theory.
C.The first is the basis for the author's critique of conventional economics; the second is his summary of conventional economic thought.
D.The first describes an event that the author believes to be unusual; the second is the author's explanation of why this unusual event occured.
E.The first is a particular example of a broader trend; the second is that trend.


Tip on Bold-face questions: Do not try to formulate a relationship between the two portions in bold!! Instead, your job is to track the relationship between each sentence/clause and the preceding sentence.

Thus, the first sentence (in bold) says that deregulation made the electricity market (specific) inefficient.

The second sentence (note the 'however') says that this specific case does not cast doubt on a general principle-- just the principle is in bold! Interpretation: The author is not critiquing the principle.

The remainder of the argument explains why the principle still holds despite the exceptional case.

Answer: B indeed!

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Re: [CR] Market Deregulation [#permalink] New post 11 Oct 2011, 11:23
IMO it is B. The first theory is an exception to the theory generally accepted, which is the second statement
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Re: [CR] Market Deregulation [#permalink] New post 20 Oct 2011, 13:13
+1 B
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Re: Deregulation of electricity markets in the United States has [#permalink] New post 14 Jan 2012, 22:19
+ 1 for B.
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Re: Deregulation of electricity markets in the United States has [#permalink] New post 28 Jan 2012, 13:24
+1 for B
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Re: Deregulation of electricity markets in the United States has [#permalink] New post 02 Mar 2013, 09:36
1:45

B it is.

(1).No state planning leaded to => Supply disruption+Higher prices.
(2).However,acc. to thry "Free market + no State planning " = > is good for economy.

So, (1) is an exception to thry.

(2). Is that thry

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Re: Deregulation of electricity markets in the United States has [#permalink] New post 11 Aug 2014, 20:47
Hello from the GMAT Club VerbalBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

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Re: Deregulation of electricity markets in the United States has   [#permalink] 11 Aug 2014, 20:47
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