Before we look at (A) and (C), let's eliminate the others:


The author does examine the differences between free and fair trade proponents, but he/she concludes that BOTH are operating under false assumptions. Examining the differences between the two groups is not the primary purpose of the discussion -- instead, the author argues that both groups are operating under false assumptions, and that the conflict between them is paralyzing Arboria's trade policy and preventing Arboria from expanding its trade. Because the discussion of free vs. fair trade is included to SUPPORT this broader point, the differences between the two groups is not the primary purpose of the passage.


The author doesn't criticize the terms of the GATT. He/she just argues that the GATT covers a smaller portion of the world economy, and therefore Arboria should not assume that global commerce is conducted under the conditions of the GATT. (D) is out.


The author discusses Arboria's trade partners ONLY to examine Arboria's trade policies. His/her purpose is not to set up a comparison between the countries, but to look more closely at Arboria's trade policies. (E) is out.

Now let's take a look at the two remaining options:



Let's start with the first couple sentences of the passage:

"Arboria is floundering in the global marketplace, incurring devastating losses in market position and profits. The problem is not Arboria's products, but Arboria's trade policy. Arboria faces the prospect of continuing economic loss until Arborian business and political leaders recognize the fundamental differences between Arborian and foreign economic systems."

The author clearly views Arboria's current trade policy as a "problem" that is hurting Arboria (causing Arboria to flounder and incur devastating economic losses). And unless something changes (i.e. "unless Arborian business and political leaders recognize..."), Arboria will face the prospect of "continuing economic loss."

How did Arboria get into this mess?

"Arboria is operating with an obsolete trade policy"--a trade policy that has NOT shifted even though economic circumstances HAVE shifted radically.

In other words, Arboria's trade policy might have been fine in the mid-1940s, but the policy hasn't adapted as economic circumstances have changed radically. And why hasn't the policy adapted?

"Arboria's trade policy seems paralyzed by the relentless conflict between proponents of “free” and “fair” trade." - If the two sides are completely at odds, it will be really hard for them to agree on potential changes to the trade policy.

To recap, Arboria has an "obsolete" trade policy, one that has left Arboria floundering and incurring devastating losses. The economic loss will continue and Arboria will miss "opportunities for trade expansion" unless something changes. It is clear that the author views the current trade policy as a problem that 1) has and will continue to hurt Arboria economically and 2) is causing Arboria to miss opportunities for trade expansion.

The author does not explicitly call for a reassessment of the trade policy, but he/she certainly explains the consequences of NOT reassessing the trade policy (i.e. continued economic loss and missed trade opportunities). In explaining the dire consequences of NOT reassessing the trade policy, the author communicates an argument FOR reassessing the trade policy (just as I can make the case FOR brushing your teeth by describing all of the negative consequences of NOT brushing your teeth).

Is the author primarily concerned with letting us know that "Arboria is floundering in the global marketplace"? No. The fact that Arboria's position in the world marketplace is eroding simply supports the notion that the current trade policy is a problem that needs to be addressed.

So (C) is our best option.
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1. Which of the following best states the difference between free trade and fair trade, as explained in the passage?
Thsi section specially refers to papa 3..
Today, Arboria's trade policy seems paralyzed by the relentless conflict between proponents of “free” and “fair” trade. The free traders argue that Arborian markets should be open, and the movement of goods and services across national borders unrestrained. The fair traders assert that access to Arborian markets should be restricted until Arborian businesses are granted equal access to foreign markets.

A. Free trade requires no trade tariffs whatsoever, whereas fair trade assumes multilateral agreement on tariffs for goods of equal worth. no where mentioned
B. Free trade is based on the unrestricted movement of goods across all national boundaries, whereas fair trade is based on a nation's restriction of commerce with each nation that erects trade barriers to the first nation's exports. Line 2 and 3 in third paragraph states this difference
C. The trade policies of countries like Arboria are based on the principles of free trade, whereas the trade policies of other types of world economies are based on fair trade.No where mentioned in the passage
D. Free-trade nations negotiate individual trade agreements with each of their trading partners, whereas fair-trade nations conduct multilateral trade negotiations.no nation comparison on these two policies is mentioned anywhere
E. Free trade assumes a constant level of global commerce, whereas fair trade promotes a steady expansion of international trade.Not mentioned in the passage

2.  It can be inferred that the author of the passage would most likely agree with which of the following statements about multilateral trade negotiations?
both sides base their positions on the same two outdated premises:
2. Multilateral negotiations are the most effective way to resolve pressing trade issues.
..Forging a multilateral trade policy consensus among so many diverse economic systems has become virtually impossible.

A. They are the most effective way to resolve trade problems.
B. They are most effective in dealing with fair-trade issues between nations.
C. They have only recently begun to make an impact on world trade.
D. Arborian reliance on multilateral trade negotiations, while appropriate in the past, is inadequate for today's global marketplace.
E. The principles of multilateral trade negotiations are incompatible with current Arborian foreign trade policy.

3.  Which of the following statements best summarizes the author's opinion of “free traders” and “fair traders”?
World trade is no longer dominated by the free-trade economies; nearly 75 percent is conducted by economic systems operating with principles at odds with those of Arboria. Forging a multilateral trade policy consensus among so many diverse economic systems has become virtually impossible. And while multilateral talks drag on, Arboria misses opportunities for trade expansion.

A. The free and the fair traders' continuing debate provides a healthy and effective forum for examining Arborian trade policy.
B. The proponents of fair trade are essentially correct, while those who advocate free trade are not.non of these two policies are marked good. Both assumptions are wrong.
C. The proponents of free trade are better able to deal with current economic problems than are the fair traders.no comparison mentioned
D. Neither the free nor the fair traders can come up with a workable trade policy because neither takes multilateral negotiations into account.they worked in past
E. The proponents of both free and fair trade have based their positions on out-of-date premises that do not reflect current economic conditions.Last 3 lines clearly state them


4.  The author mentions all of the following as characteristic of world trade in the mid-1940s EXCEPT:

A. Arboria played a major role in the global marketplace. Arboria and Whorfland dominated the global economy,
B. Whorfland played a major role in the global marketplace. Arboria and Whorfland dominated the global economy,
C. Tariffs were the main obstacle to trade.Arboria is operating with an obsolete trade policy, an artifact of the mid-1940s
D. Fair-trade economies dominated international trade.no where mentioned
E. Arborian manufacturers were unsurpassed in most industries.Arborian supremacy was uncontested in virtually all industries.


5.  In presenting the argument in the passage, the author uses all of the following EXCEPT:

A. statistical information about global commerceThe 40-year-old GATT now covers less than 7 percent of global commerce. World trade is no longer dominated by the free-trade economies; nearly 75 percent is conducted by economic systems operating with principles at odds with those of Arboria.
B. definitions of terms concerning world trade The free traders argue.... The fair traders assert that access to Arborian markets should be restricted...
C. generalizations about Arboria's economic systemrboria faces the prospect of continuing economic loss until Arborian business and political leaders recognize the fundamental differences between Arborian and foreign economic systems
D. historical background of Arborian trade policyfree trade and fair trade policies
E. an example of an economic system whose principles differ from those of ArboriaNo other country is mentioned in the passage

6.  The author asserts which of the following about Arboria's trade policy?

A. A dramatic revision of Arboria's trade policy will be necessary unless Arborian manufacturers improve the quality of their goods.The problem is not Arboria's products, but Arboria's trade policy
B. The most crucial issue facing Arborian trade policymakers is that of free trade versus protectionismts both free and fair trade not just comaprison between two.
C. Arboria's current trade policy was essentially developed during the 1940s and has changed little since that time.Thsi is clearly mentioned as it hasnt chanegd over time
D. Arboria's trade policy is widely emulated throughout the world, to the extent that most international commerce is modeled on Arboria's principles.ut both sides base their positions on the same two outdated premises: Nations thus do not follow these principles
E. Arboria's trade policy has evolved gradually over the last eighty years, constantly readjusting itself in response to shifts in global commerce.But both sides base their positions on the same two outdated premises: Thus no change

7.  The passage is primarily concerned with
Tha passage talkes about Arboria in general and about its outdated policies that haven't changed overtime .How market has moved and now Arboria should re-evaluate to change their policies as the old principles are no longer valid. C satisfies that
A. illustrating the erosion of Arboria's position in the world marketplace
B. examining the differences between “free” and “fair” traders
C. advocating a reassessment of Arboria's trade policy
D. criticizing the terms of the General Agreement on Tariffs and Trade (GATT)
E. comparing the different economic circumstances of Arboria's trade partners

8.  The author implies that the main obstacle to a truly effective Arborian trade policy is the
Arboria faces the prospect of continuing economic loss until Arborian business and political leaders recognize the fundamental differences between Arborian and foreign economic systems. Today the key trade issue is not free trade versus protectionism but diminishing trade versus expanding trade.
A. weak position that Arboria currently holds in the global marketplace
B. inability of Arborian leaders to recognize that foreign economic systems are based on principles fundamentally different from their ownrewording of exactly wha is implied in para 1 last lines
C. dominance of the supporters of free trade in the conflict between free-trade and fair-trade advocates
D. apparent inability of Arborian industries to produce goods that are competitive in the world market
E. protectionism that characterizes the foreign trade policies of so many of Arboria's trade partners
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Can someone please explain the answers to Q7? I got those 3 (Q2 and Q6 too) wrong.
I understand Q2 is a blunder, a huge mistake that I did hurrying up myself.
Q6 - Well, I was hung between Option B and C. I went with B as it sounded like a conclusion, an inference that the author "asserts". But there's no mention of free AND fair trade. So, it is wrong.

Q7 - It would be really helpful if someone explains it to me why A is wrong here. TIA.
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Thanks , its para2 actually, but I get it, C cannot be answer. But D is also mentioned, or is international trade and world trade are 2 different things..
World trade is no longer dominated by the free-trade economies; in the last para

Apologies yeah it is para 2. I missed the context.
For D it says Fair trade economies dominated the market but this is not entirely true . It says Arboria dominated once but. Arboria's trade policy seems paralyzed by the relentless conflict between proponents of “free” and “fair” trade.
Can you help me find the exact line you are referring ?
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Sure,
Both assumptions are wrong. The 40-year-old GATT now covers less than 7 percent of global commerce. World trade is no longer dominated by the free-trade economies; nearly 75 percent is conducted by economic systems operating with principles at odds with those of Arboria.

All correct in 11 mins 30 seconds, including almost 4 mins to read.

Para 1- Arboria's trade policy- continuing economic loss
Para 2- obsolete trade policy
Para 3- paralyzed by the relentless conflict between free and fare traders, 2 outdated premises
Para 4- Issues with the two outdated assumptions

494.  Which of the following best states the difference between free trade and fair trade, as explained in the passage?
B. Free trade is based on the unrestricted movement of goods across all national boundaries, whereas fair trade is based on a nation's restriction of commerce with each nation that erects trade barriers to the first nation's exports.

The free traders argue that Arborian markets should be open, and the movement of goods and services across national borders unrestrained. The fair traders assert that access to Arborian markets should be restricted until Arborian businesses are granted equal access to foreign markets.

495.  It can be inferred that the author of the passage would most likely agree with which of the following statements about multilateral trade negotiations?
D. Arborian reliance on multilateral trade negotiations, while appropriate in the past, is inadequate for today's global marketplace.

But both sides base their positions on the same two outdated premises:
Forging a multilateral trade policy consensus among so many diverse economic systems has become virtually impossible.

496.  Which of the following statements best summarizes the author's opinion of “free traders” and “fair traders”?
E. The proponents of both free and fair trade have based their positions on out-of-date premises that do not reflect current economic conditions.

Both are correct: fair trade requires equal access and equal access leads to free trade. But both sides base their positions on the same two outdated premises:

497.  The author mentions all of the following as characteristic of world trade in the mid-1940s EXCEPT:

A. Arboria played a major role in the global marketplace.- incorrect, an artifact of the mid-1940s when Arboria and Whorfland dominated the global economy
B. Whorfland played a major role in the global marketplace.- same as A
C. Tariffs were the main obstacle to trade.- incorrect, tariffs were the principal obstacle to trade
D. Fair-trade economies dominated international trade.- Correct
E. Arborian manufacturers were unsurpassed in most industries.- incorrect, Arborian supremacy was uncontested in virtually all industries

498.  In presenting the argument in the passage, the author uses all of the following EXCEPT:

A. statistical information about global commerce- incorrect, The 40-year-old GATT now covers less than 7 percent of global commerce. World trade is no longer dominated by the free-trade economies; nearly 75 percent is conducted by economic systems operating with principles at odds with those of Arboria.
B. definitions of terms concerning world trade- incorrect, The free traders argue that..
C. generalizations about Arboria's economic system- incorrect, first para
D. historical background of Arborian trade policy - incorrect, Arboria is operating with an obsolete trade policy...
E. an example of an economic system whose principles differ from those of Arboria - Correct

499.  The author asserts which of the following about Arboria's trade policy?
C. Arboria's current trade policy was essentially developed during the 1940s and has changed little since that time. - correct, In the intervening decades, economic circumstances have shifted radically. Arborian trade policy has not.

500.  The passage is primarily concerned with
C. advocating a reassessment of Arboria's trade policy - correct, Arboria's trade policy is an outdated one and is not appropriate for the present market

501.  The author implies that the main obstacle to a truly effective Arborian trade policy is the
B. inability of Arborian leaders to recognize that foreign economic systems are based on principles fundamentally different from their own

The problem is not Arboria's products, but Arboria's trade policy. Arboria faces the prospect of continuing economic loss until Arborian business and political leaders recognize the fundamental differences between Arborian and foreign economic systems. Today the key trade issue is not free trade versus protectionism but diminishing trade versus expanding trade.
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Hi Guys,

How did you discard option E over option D?
I had a tough time discarding E as option E states - The principles of multilateral trade negotiations are INCOMPATIBLE with current Arborian foreign trade policy.

"nearly 75 percent is conducted by economic systems operating with PRINCIPLES at ODDS with those( PRINCIPLES) of Arboria."

Excerpt from the passage -

But both sides base their positions on the same two outdated premises:
World trade is no longer dominated by the free-trade economies; nearly 75 percent is conducted by economic systems operating with principles at odds with those of Arboria. Forging a multilateral trade policy consensus among so many diverse economic systems has become virtually impossible.

globaldesi, Skywalker18
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500.  The passage is primarily concerned with

A. illustrating the erosion of Arboria's position in the world marketplace
B. examining the differences between “free” and “fair” traders
C. advocating a reassessment of Arboria's trade policy
D. criticizing the terms of the General Agreement on Tariffs and Trade (GATT)
E. comparing the different economic circumstances of Arboria's trade partners

Can someone tell me why C is the correct answer? In the passage, the author talks about Arboria`s struggle in the global marketplace, then he talks about the problem, conflict between proponents of free and fair trade and how both of them are wrong. So where in the passage is the author advocating a reassessment? Isnt he just talking about the problems?
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GMATNinja

Can you help with Q.7?

I chose option A instead of C. Because there is no sentence explicitly advocating a re-assessment of Arboria's trade policy. The entire passage just seems to explain why Arboria's trade policy is outdated- eg. the premises

GMATNinja
How to decide between D and E?

The author states at the beginning of the 3rd paragraph that Arboria's current trade policy seems "seems paralyzed by the relentless conflict between proponents of “free” and “fair” trade."

He/she goes on to say that both of these groups operate under the incorrect assumption that "multilateral negotiations are the most effective way to resolve pressing trade issues."

The reason why he/she believes that this assumption is wrong is that "forging a multilateral trade policy consensus among so many diverse economic systems has become virtually impossible."

Take a look at answer choice (E) for question #495:

From the analysis above, the author believes that those involved in Arboria's current policy are operating under the assumption that multilateral trade negotiations are the way to go. So, he/she would not agree that the principles of multilateral trade negotiations are incompatible with current policy -- he/she just thinks that the assumption regarding multilateral trade negotiations should be questioned when developing a new trade policy. (E) is out.


Bingo! The author believes that both "free" and "fair" trade advocates are wrong in assuming that multilateral trade negotiations are appropriate in the current marketplace.

(D) is the correct answer to question #495.

I hope that helps!
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Hi Skywalker18 and GMATNinja
As for Question "It can be inferred that the author of the passage would most likely agree with which of the following statements about multilateral trade negotiations" I had intended to choose (D) but then changed my mind as the phrase "while approriate in the past" put me off. I just couldn't find any particular detail in the passage which shows how "approriate" Arborian reliance on multilateral trade negotiations is.

Could you help me with this concern?
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Hi Tracy95,

The 'appropriate in the past' point can be inferred from the below parts of the passage,

"an artifact of the mid-1940s when Arboria and Whorfland dominated the global economy," (paragraph 2) and "But both sides base their positions on the same two outdated premises:
1. Global commerce is conducted under the terms of the General Agreement on Tariffs and Trade (GATT) and dominated by Arboria and similar economic systems abroad.
2. Multilateral negotiations are the most effective way to resolve pressing trade issues." (paragraph 3).

Plus a mix of why Arborian reliance on multilateral trade negotiations is not appropriate now and why it was appropriate before (in bold) can be inferred from the last paragraph,

"World trade is no longer dominated by the free-trade economies; nearly 75 percent is conducted by economic systems operating with principles at odds with those of Arboria (which according to passage 2 have not changed much since the mid-1940s). Forging a multilateral trade policy consensus among so many diverse economic systems has become virtually impossible."

Thanks
Saurabh

Guys can someone explain question 7, I can't see why C is the answer, nothing is "advocated", there is no adjective used at all in the passage that suggests he is arguing for something, the theme is neutral

the official explanation says A is wrong because "“illustrating” something generally involves providing a specific example, but the passage gives no example to show how the arborian trade position has declined relative to that of other countries"

and C "This is the theme of thep assage, which advocates a reconsideration of Arborian trade policy and the longstanding assumptions on which it has been based. This central concern prompts the discussion of other relevant, but subsidiary, topics."

GMATNinja

Hi mrcentauri,

Please refer to the below explanation to Q7 by experts:

https://gmatclub.com/forum/arboria-is-f ... l#p2316349


Let me know if you still have any doubts.
Thanks.

501.  The author implies that the main obstacle to a truly effective Arborian trade policy is the

A. weak position that Arboria currently holds in the global marketplace
B. inability of Arborian leaders to recognize that foreign economic systems are based on principles fundamentally different from their own
C. dominance of the supporters of free trade in the conflict between free-trade and fair-trade advocates
D. apparent inability of Arborian industries to produce goods that are competitive in the world market
E. protectionism that characterizes the foreign trade policies of so many of Arboria's trade partners



GMATNinja, Could you please help me with Q8? I was struggling between B and C, and I chose C because the first sentence in the third paragraph "Today, Arboria's trade policy seems paralyzed by the relentless conflict between proponents of “free” and “fair” trade. " I am always very bad at inference problems, Please help. Thank you.

Question 8

We’re looking for an answer choice that the author implies is the main obstacle to a truly effective Arborian trade policy. With that in mind, let’s consider (C):


As you noted, the author of the passage takes note of the apparent effect of the debate between “free” and “fair” trade supporters on Arboria’s trade policy. But nowhere does the author indicate that supporters of free trade are dominant in that conflict. Moreover, the author only states that the conflict SEEMS to paralyze Arboria. That’s different than saying the debate DOES paralyze the economy. For those two reasons, we can eliminate (C).

And here’s (B):


In the third sentence of the first paragraph, the author states that “Arboria faces the prospect of continuing economic loss until Arborian business and political leaders recognize the fundamental differences between Arborian and foreign economic systems.” In other words, Arborian trade policy is ineffective because it’s based on fundamentally different principles than those of foreign economies. That’s what (B) says, so (B) is correct.

I hope that helps!
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