The federal government faces a crisis in the way it collects, analyzes

Question

The federal government faces a crisis in the way it collects, analyzes, and disseminates information. Paradoxically, at the very moment new information technologies are transforming the United States economy, we are forced to analyze that economy on the basis of data that are often outright misleading. Government statistics arc only as good as the assumptions shaping the collection and analysis of data. A classic example of a decades-old faulty assumption concerns how the national accounts define government investment.

In private industry, standard accounting practice divides a firm's outlays into long-term investment in new plants and equipment and short-term current expenses—wages, salaries, and the cost of supplies.  National statistics honor this distinction for private-sector businesses but not for government spending. Thus, money spent on highways—roughly 10 percent of all spending by state and local governments—is not counted as an investment, even though those highways will probably last many years. This curious practice creates problems in tracking spending in the economy. Because government investments are excluded by definition, figures on net investment are regularly underestimated. And no provision is made to cover the depredation of crumbling roads, sewers, and schools. Finally and perhaps most important, the government's growing role as art investor in the nation's infrastructure is obscured; thus, government spending appears to be unnecessary or even profligate.

Other assumptions were reasonable when they were first made but have become obsolete as a result of economic change. Consider how we treat both public and private spending on education and training, which amounts to roughly S300-S500 billion each year—more than the net private purchases of equipment like machine tools and computers. As the economy becomes more complex and advanced technologies play a more central role, education and training begin to represent a crucial investment.  Yet government statistics treat spending on the intellectual capabilities of the work force no differently from spending on paper clips.  The data suggest that a company is investing if it purchases a new machine, but not if it pays for the employee training needed to use that machine efficiently.    1 
 1. The passage is primarily concerned with

A. resolving a contradiction
B. drawing a comparison
C. supporting an assertion
D. explaining a procedure
E. suggesting a solution

2 
 2. It can be inferred from the passage that which of the following would be true if the government used the private-sector accounting practice described in lines 11-14 (  Highlighted  )

I. Estimation of net investment by the government would be more accurate.
II. Some provision for depreciation of government-funded projects would be made.
III. Tracking the extent of the government's role as an investor in the economy would become less problematic.

A. I only
B. II only
C. I and II only
D. II and III only
E. I, II, and III

3 
 3. Which of the following most accurately restates information in the passage?

A. Government accounting procedures have been made obsolete by new computer-based technologies.
B. The federal government needs to expand its data collection in order to produce accurate statistics.
C. Government statistics do not accurately reflect the economy they are supposed to track because of the way in which data are collected and analyzed.
D. The federal government would be more cost-efficient if it used private-sector accounting procedures.
E. The largest single investment the federal government tracks in its accounting procedures is the cost of highways.

4 
 4. The author uses paper dips in the comparison drawn in lines 39-41 ( Text in Red ) most probably in order to emphasize

A. how little the government spends on education and training
B. what conditions technological change has created for workers
C. how much the economy of the United States has changed
D. how misleading government statistics can be
E. how large the amount spent on work-force education really is

5 
 5. Which of the following, if true, most closely resembles the paradoxical situation the author describes in the first paragraph?

A. Advances in medical knowledge have led to the control of many diseases and thus prolonged lives, but the aging process cannot be arrested.
B. Perfection of fiber-optic technology has improved telephone service all over the world, but the price of such service continues to escalate.
C. New building materials have completely changed the way buildings are built, but the only building safety codes available to judge a building's soundness are based solely on old-fashioned materials.
D. An increasing number of banks and other financial institutions are investing in higher-risk, higher-yield securities despite the record number of financial institution failures in the past two years.
E. The reported total amount spent in the private sector on training new employees has remained constant, whereas the amount spent on salaries for corporate-training personnel has increased dramatically.

6 
 6. It can be inferred from the passage that which of the following is true of government statistics in the United States?

A. Some government statistics suggest that in any given year the government is more wasteful than is actually the case.
B. Some government statistics report so much detail in so many categories that they are cumbersome to use.
C. Government statistics arc based on assumptions similar to those that underlie private-sector economic analyses.
D. Accurate governmental statistical information is no longer important to economic analysts.
E. Government statistics as a source of economic information have been supplanted by private sector economic analyses.

Oppenheimer1945 · Answer

The federal government faces a crisis in the way it collects, analyzes, and disseminates information. Paradoxically, at the very moment new information
Government statistics arc only as good as the assumptions shaping the collection and analysis of data.

1. The passage is primarily concerned with

A. resolving a contradiction (this is what the author begins the passage with and does a along) 
B. drawing a comparison (this is just a part of passage)
C. supporting an assertion (this is more of resolution of conflict)
D. explaining a procedure (this is not the primary purpose)
E. suggesting a solution (author is not suggesting any solution)

Because government investments are excluded by definition, figures on net investment are regularly underestimated. And no provision is made to cover the depredation of crumbling roads, sewers, and schools. Finally and perhaps most important, the government's growing role as art investor in the nation's infrastructure is obscured; thus, government spending appears to be unnecessary or even profligate.

2. It can be inferred from the passage that which of the following would be true if the government used the private-sector accounting practice described in lines 11-14 (Highlighted)

I. Estimation of net investment by the government would be more accurate.
II. Some provision for depreciation of government-funded projects would be made.
III. Tracking the extent of the government's role as an investor in the economy would become less problematic.

A. I only
B. II only
C. I and II only
D. II and III only
 E. I, II, and III (True)

new information technologies are transforming the United States economy, we are forced to analyze that economy on the basis of data that are often outright misleading.

3. Which of the following most accurately restates information in the passage?

A. Government accounting procedures have been made obsolete by new computer-based technologies.(not True)
B. The federal government needs to expand its data collection in order to produce accurate statistics.(nowhere this is suggested to expand the data collection)
 C. Government statistics do not accurately reflect the economy they are supposed to track because of the way in which data are collected and analyzed.( government investments are excluded by definition, figures on net investment are regularly underestimated.) True 
D. The federal government would be more cost-efficient if it used private-sector accounting procedures. (cost efficient is not discussed)
E. The largest single investment the federal government tracks in its accounting procedures is the cost of highways (highways is not the largest single investment- roughly 10 percent of all spending by state and local governments)

4. The author uses paper dips in the comparison drawn in lines 39-41 (Text in Red) most probably in order to emphasize

A. how little the government spends on education and training (the next lines suggest investment in equipment is investment and not on intellectual cap) 
B. what conditions technological change has created for workers
C. how much the economy of the United States has changed
D. how misleading government statistics can be
E. how large the amount spent on work-force education really is

A classic example of a decades-old faulty assumption concerns how the national accounts define government investment.
We need to mark option stating people find old Tech is Good.
5. Which of the following, if true, most closely resembles the paradoxical situation the author describes in the first paragraph?

A. Advances in medical knowledge have led to the control of many diseases and thus prolonged lives, but the aging process cannot be arrested. (False)
B. Perfection of fiber-optic technology has improved telephone service all over the world, but the price of such service continues to escalate. (False)
 C. New building materials have completely changed the way buildings arc built, but the only building safety codes available to judge a building's soundness are based solely on old-fashioned materials. (True) 
D. An increasing number of banks and other financial institutions are investing in higher-risk, higher-yield securities despite the record number of financial institution failures in the past two years.(False)
E. The reported total amount spent in the private sector on training new employees has remained constant, whereas the amount spent on salaries for corporate-training personnel (False)

Finally and perhaps most important, the government's growing role as art investor in the nation's infrastructure is obscured; thus, government spending appears to be unnecessary or even profligate.

6. It can be inferred from the passage that which of the following is true of government statistics in the United States?

A. Some government statistics suggest that in any given year the government is more wasteful than is actually the case. (True) 
B. Some government statistics report so much detail in so many categories that they are cumbersome to use.
C. Government statistics arc based on assumptions similar to those that underlie private-sector economic analyses.
D. Accurate governmental statistical information is no longer important to economic analysts.
E. Government statistics as a source of economic information have been supplanted by private sector economic analyses.

mayankdgmat · Answer

1. The passage is primarily concerned with

IMO B

A. resolving a contradiction
No contradiction was made, instead a paradox has been presented

B. drawing a comparison 
comparison was made between private and government accounting.

C. supporting an assertion
No assertion was made.

D. explaining a procedure
No procedure was explained

E. suggesting a solution
No solution has been presented, instead only shortcomings has been mentioned.

2. It can be inferred from the passage that which of the following would be true if the government used the private-sector accounting practice described in lines 11-14 (Highlighted)

I. Estimation of net investment by the government would be more accurate.
II. Some provision for depreciation of government-funded projects would be made.
III. Tracking the extent of the government's role as an investor in the economy would become less problematic.

IMO E

I can be deduced from "Because government investments are excluded by definition, figures on net investment are regularly underestimated"
II can be deduced from "And no provision is made to cover the depredation of crumbling roads, sewers, and schools"
III can be deduced from "the government's growing role as art investor in the nation's infrastructure is obscured; thus, government spending appears to be unnecessary or even profligate."

3. Which of the following most accurately restates information in the passage?

IMO C

A. Government accounting procedures have been made obsolete by new computer-based technologies.
Nothing sort of this is mentioned in passage

B. The federal government needs to expand its data collection in order to produce accurate statistics.
No, instead they need to collect relevant data and analyse it strategiclly.

C. Government statistics do not accurately reflect the economy they are supposed to track because of the way in which data are collected and analyzed. 
Yes, exactly this is the point passage made.

D. The federal government would be more cost-efficient if it used private-sector accounting procedures.
Nothing about cost efficent mentioned in passage.

E. The largest single investment the federal government tracks in its accounting procedures is the cost of highways.
They don't even consider highway as investment.

4. The author uses paper dips in the comparison drawn in lines 39-41 (Text in Red) most probably in order to emphasize

IMO D

A. how little the government spends on education and training
No, instead importance of investment in education and training was not considered. We don't know about amount spend.

B. what conditions technological change has created for workers
No, nothing discussed about effect on workers

C. how much the economy of the United States has changed
No, instead economy is being analysed on same obsolete data.

D. how misleading government statistics can be 
Yes, exactly when one consider training and development same as buying clip. statstics would be misleading.

E. how large the amount spent on work-force education really is
Again same as discussed in (A), amount is not known.

5. Which of the following, if true, most closely resembles the paradoxical situation the author describes in the first paragraph?

IMO C

Paradoxical situation is government is still using older method to present information whereas information technology is changes to economy and should be considered in claculation.

A. Advances in medical knowledge have led to the control of many diseases and thus prolonged lives, but the aging process cannot be arrested.
Not parellel to our paradox

B. Perfection of fiber-optic technology has improved telephone service all over the world, but the price of such service continues to escalate.
Not parellel to our paradox

C. New building materials have completely changed the way buildings are built, but the only building safety codes available to judge a building's soundness are based solely on old-fashioned materials. 
Exactly matches with our paradox

D. An increasing number of banks and other financial institutions are investing in higher-risk, higher-yield securities despite the record number of financial institution failures in the past two years.
Not parellel to our paradox

E. The reported total amount spent in the private sector on training new employees has remained constant, whereas the amount spent on salaries for corporate-training personnel has increased dramatically.
Not parellel to our paradox

6. It can be inferred from the passage that which of the following is true of government statistics in the United States?

IMO A

A. Some government statistics suggest that in any given year the government is more wasteful than is actually the case. 
Hold it, since passage suggest that statistical data undermine spending, investing etc.

B. Some government statistics report so much detail in so many categories that they are cumbersome to use.
Nothing aout data amount is mentioned in passage. Eliminate

C. Government statistics arc based on assumptions similar to those that underlie private-sector economic analyses.
No indeed they are different. Eliminate

D. Accurate governmental statistical information is no longer important to economic analysts.
No information from passage support this. Eliminate

E. Government statistics as a source of economic information have been supplanted by private sector economic analyses.
Nothing mentioned in passage. Eliminate

missionmba2025 · Answer

1. The passage is primarily concerned with

A. resolving a contradiction

While the passage does acknowledge a contradiction (the government uses advanced technology, yet relies on outdated data collection methods), resolving that contradiction isn't the primary focus. The focus is on the consequences of this outdated methodology.

B. drawing a comparison

The passage briefly compares the accounting practices of the government and private sector, but this comparison is used to support the assertion about the underestimation of government investment.

C. supporting an assertion - CORRECT

This is the most accurate answer. The passage primarily supports the assertion that there are flaws in the way the federal government collects, analyzes, and disseminates information, particularly regarding economic data.

D. explaining a procedure

The passage does explain certain procedures, such as how standard accounting practice treats investments in private industry, but the main focus is not on explaining a procedure.

E. suggesting a solution

While the passage does imply that there are problems that need to be addressed, it doesn't primarily focus on suggesting specific solutions.

2. It can be inferred from the passage that which of the following would be true if the government used the private-sector accounting practice described in lines 11-14 (  Highlighted  )

I. Estimation of net investment by the government would be more accurate.
II. Some provision for depreciation of government-funded projects would be made.
III. Tracking the extent of the government's role as an investor in the economy would become less problematic.

A. I only
B. II only
C. I and II only
D. II and III only
E. I, II, and III

I. Estimation of net investment by the government would be more accurate.

This statement aligns with the passage because it suggests that if the government were to treat its spending on infrastructure (such as highways) as investments, rather than mere expenses, it would lead to a more accurate estimation of net investment.II. Some provision for depreciation of government-funded projects would be made.

This statement is also supported by the passage. It mentions that under private-sector accounting practices, long-term investments are distinguished from short-term expenses, implying that depreciation of assets (such as crumbling roads, sewers, and schools) would be accounted for.

III. Tracking the extent of the government's role as an investor in the economy would become less problematic

This statement is implied by the passage. It argues that the current method of accounting for government spending obscures the government's role as an investor in the nation's infrastructure.

Correct Answer : E

3. Which of the following most accurately restates information in the passage?

A. Government accounting procedures have been made obsolete by new computer-based technologies.

While the passage mentions the paradox of using outdated data collection methods in an age of advanced technology, it doesn't claim that computer-based technology has rendered the entire system obsolete.

B. The federal government needs to expand its data collection in order to produce accurate statistics.

The passage doesn't necessarily advocate for expanding data collection. Instead, it focuses on the inappropriateness of the current assumptions used to analyze the data

C. Government statistics do not accurately reflect the economy they are supposed to track because of the way in which data are collected and analyzed.

This option accurately restates the main point of the passage. It highlights that the primary issue with government statistics is not the lack of data but rather the flawed methods of collecting and analyzing the available data.

D. The federal government would be more cost-efficient if it used private-sector accounting procedures.

The passage does not discuss cost-efficiency in relation to adopting private-sector accounting procedures.

E. The largest single investment the federal government tracks in its accounting procedures is the cost of highways.

While the passage mentions highways as an example of government spending not being counted as an investment, it does not suggest that highways are the largest single investment the federal government tracks.

4. The author uses paper dips in the comparison drawn in lines 39-41 ( Text in Red ) most probably in order to emphasize

A. how little the government spends on education and training

This comparison does not emphasize the amount of government spending on education and training. Instead, it focuses on how government statistics treat such spending, regardless of the amount.

B. what conditions technological change has created for workers

The comparison does not directly relate to the conditions created by technological change for workers.

C. how much the economy of the United States has changed

The comparison focuses on the misleading nature of statistics, not the broader economic changes.

D. how misleading government statistics can be

This option aligns closely with the passage. The comparison of education and training spending to paper clips is meant to emphasize how government statistics can be misleading by treating significant investments in education and training as equivalent to mundane expenditures on office supplies like paper clips.

E. how large the amount spent on work-force education really is

While the passage mentions the substantial amount spent on education and training, the paper clip comparison is not emphasizing the magnitude of this spending.

5. Which of the following, if true, most closely resembles the paradoxical situation the author describes in the first paragraph?

The passage describes a situation where advanced technology (new information technologies) exists, but the data collection and analysis methods (outdated assumptions) haven't been updated to reflect this change. This leads to misleading information being used to understand the economy.

A. Advances in medical knowledge have led to the control of many diseases and thus prolonged lives, but the aging process cannot be arrested.

While there's an element of advancement (medical knowledge) and limitation (aging process), the focus isn't on outdated methods used to analyze a changed reality.

B. Perfection of fiber-optic technology has improved telephone service all over the world, but the price of such service continues to escalate.

This option describes a positive advancement (fiber-optic technology) with a negative consequence (price increase), but it doesn't involve outdated methods hindering accurate assessment.

C. New building materials have completely changed the way buildings are built, but the only building safety codes available to judge a building's soundness are based solely on old-fashioned materials.

This option closely resembles the paradox described in the passage. It presents a situation where technological advancements (new building materials) have transformed an industry (construction), but the standards and regulations (building safety codes) have not caught up with these advancements, leading to a paradoxical situation.

D. An increasing number of banks and other financial institutions are investing in higher-risk, higher-yield securities despite the record number of financial institution failures in the past two years.

This option presents a situation where financial institutions are making risky investments despite recent failures. While it involves risk-taking behavior amid adverse circumstances, it doesn't directly parallel the situation described in the passage.

E. The reported total amount spent in the private sector on training new employees has remained constant, whereas the amount spent on salaries for corporate-training personnel has increased dramatically.

This option describes a discrepancy within a single sector (private sector training) but doesn't involve a broader issue of outdated methods hindering accurate assessment, as seen in the passage and option C.

6. It can be inferred from the passage that which of the following is true of government statistics in the United States?

A. Some government statistics suggest that in any given year the government is more wasteful than is actually the case.

This aligns with the passage's assertion that government statistics can be misleading due to faulty assumptions and practices, such as not accounting for long-term investments like highways.

B. Some government statistics report so much detail in so many categories that they are cumbersome to use.

The passage doesn't directly discuss the level of detail or usability of government statistics. It primarily focuses on the misleading nature of these statistics due to flawed assumptions and practices.

C. Government statistics arc based on assumptions similar to those that underlie private-sector economic analyses.

This contradicts the core point of the passage, which is that the government uses outdated and inappropriate assumptions compared to the private sector, leading to misleading information.

D. Accurate governmental statistical information is no longer important to economic analysts.

The passage emphasizes the importance of accurate government statistics for analyzing the economy. Hence, this option is not correct.

E. Government statistics as a source of economic information have been supplanted by private sector economic analyses.

While the passage acknowledges the limitations of government statistics, it doesn't suggest they have been completely replaced by private sector analyses. Both sources can be valuable, but the government statistics need improvement to be reliable.

Answers 
1. C
2. E
3. C
4. D
5. C
6. A

Anugmat740 · Answer

IMO  BECDCA
1. The passage is primarily concerned with 
P1: Govt data is misleading and faulty asumptions are made about the government investment.
P2: An example about a faulty assumptions and distinction between private industry and government accounting procedures.
P3: Due to economic changes some assumptions became obsolete and one such example is given.

A. resolving a contradiction ~ No contradiction is resolved.
 B. drawing a comparison 
C. supporting an assertion ~ Author does not support any assertion. 
D. explaining a procedure ~ Between B and D. B is more apt as author does not explain why it is happening.
E. suggesting a solution ~ Author does not suggest any solution.

2. It can be inferred from the passage that which of the following would be true if the government used the private-sector accounting practice described in lines 11-14 (Highlighted) 
 I. Estimation of net investment by the government would be more accurate.  -Because government investments are excluded by definition, figures on net investment are regularly underestimated.
 II. Some provision for depreciation of government-funded projects would be made.  - Some provisions are made to cover the degredation of roads, sewers, etc.
 III. Tracking the extent of the government's role as an investor in the economy would become less problematic.  - Refer to the lines"This curious practice creates problems in tracking spending in the economy."

A. I only
B. II only
C. I and II only
D. II and III only
 E. I, II, and III

3. Which of the following most accurately restates information in the passage? 
A. Government accounting procedures have been made obsolete by new computer-based technologies. ~ They were made obsolete as a result of economic change and not by new computer- based technologies.

B. The federal government needs to expand its data collection in order to produce accurate statistics.~ The data that is collected is misleading and there is no mention that the data is insufficient for analysis.

C. Government statistics do not accurately reflect the economy they are supposed to track because of the way in which data are collected and analyzed.  ~ Correct, Refer to the line "Government statistics arc only as good as the assumptions shaping the collection and analysis of data." In later it was mentioned that these analysis leads to inaccurate measurement of the economy.

D. The federal government would be more cost-efficient if it used private-sector accounting procedures. ~ The govt. spending appears to be profilgate, but by using private sector accounting procedure we cannot certainly say that it will become cost-efficient.

E. The largest single investment the federal government tracks in its accounting procedures is the cost of highways. ~ Roughly 10% investment may or may not be the largest single investment.

4. The author uses paper dips in the comparison drawn in lines 39-41 (Text in Red) most probably in order to emphasize 
This is mentioned to highlight how these assumptions have become obsolete. The spending on paper clip should be differently accounted than the spending on intellectual capabilities. This clearly explain that the government statistics are misleading.

A. how little the government spends on education and training
B. what conditions technological change has created for workers
C. how much the economy of the United States has changed
 D. how misleading government statistics can be 
E. how large the amount spent on work-force education really is

5. Which of the following, if true, most closely resembles the paradoxical situation the author describes in the first paragraph? 
The paradox presented in the first paragraph is that the government is analyzing economy on the basis of an outright misleading data despite new Information technology companies which are transforming the US economy.

A. Advances in medical knowledge have led to the control of many diseases and thus prolonged lives, but the aging process cannot be arrested.

B. Perfection of fiber-optic technology has improved telephone service all over the world, but the price of such service continues to escalate.

C. New building materials have completely changed the way buildings are built, but the only building safety codes available to judge a building's soundness are based solely on old-fashioned materials .~ Correct  New building material is analogus to New IT Companies  and  the safety codes available to judge a building soundness based on old fashioned material is outright misleading data used by the Government .

D. An increasing number of banks and other financial institutions are investing in higher-risk, higher-yield securities despite the record number of financial institution failures in the past two years.

E. The reported total amount spent in the private sector on training new employees has remained constant, whereas the amount spent on salaries for corporate-training personnel has increased dramatically.

6. It can be inferred from the passage that which of the following is true of government statistics in the United States?

A. Some government statistics suggest that in any given year the government is more wasteful than is actually the case.  ~ Correct, refer to the line "Finally and perhaps most important, the government's growing role as art investor in the nation's infrastructure is obscured; thus, government spending appears to be  unnecessary or even profligate ."

B. Some government statistics report so much detail in so many categories that they are cumbersome to use. ~ They have became cubersome but not due to the extra details, it is because of incorrect data.

C. Government statistics are based on assumptions similar to those that underlie private-sector economic analyses. ~ Not correct in the case of Highways.

D. Accurate governmental statistical information is no longer important to economic analysts. ~ This opinion is not expressed in the passage.

E. Government statistics as a source of economic information have been supplanted by private sector economic analyses. ~ No such supplement information is provided to draw this conclusion.

Sss678 · Answer

Q1. The passage is primarily concerned with 
My answer is C)
 C. supporting an assertion 
The author of the passage is makes an assertion that the accuracy of government statistics on spending is poor and faulty in the first lin eof the first para. And then in subsequent paragraphs, he explains and supports it with diffferent examples.

A. resolving a contradiction
The author makes no major contradictory statement in the passage. It is an assertio nhe istrying to support.

B. drawing a comparison
At times, the author is comparing the government method of collecting and analysing data to that of private sector. But he mainly uses private sector to prove his assertion of faulty and obsolete government method of tracking investment and spending. So comparison is not the primary idea.

D. explaining a procedure
There is no proedure that the author is trying to explain.

E. suggesting a solution
The author has mentioned about the problem but he is trying ot explain the issue from different angles. He doesn't provide any solutions to mitigate the risk or resolve the issue.

Q2. It can be inferred from the passage that which of the following would be true if the government used the private-sector accounting practice described in lines 11-14 (Highlighted) 
My answer is E)
 E. I, II, and III 
If the government uses the private-sector accounting practice described in lines 11-14, it will lead to:
a) increased accuracy of estimation of investment by the government - "This curious practice creates problems in tracking spending in the economy.Because government investments are excluded by definition, figures on net investment are regularly underestimated"
b) provision for depreciation of government-funded projects - "And no provision is made to cover the depredation of crumbling roads, sewers, and schools."
c) beteer tracking of the extent of government's role as art investor

Rest of the choices A).B),C) and D) excludes one or more of the options given. hence those are incorrect.

Q3. Which of the following most accurately restates information in the passage? 
My answer is C)
 C. Government statistics do not accurately reflect the economy they are supposed to track because of the way in which data are collected and analyzed. 
It is the restatement of the following line mentioned in the passage - "The federal government faces a crisis in the way it collects, analyzes, and disseminates information. Paradoxically, at the very moment new information technologies are transforming the United States economy, we are forced to analyze that economy on the basis of data that are often outright misleading."

A. Government accounting procedures have been made obsolete by new computer-based technologies.
The author does not tell that the new technologies have made the government accounting procedures obsolete. In fact, it is mentioned that even as the new technologies are transforming the economy, the obsolete accounting procedures are creating a crisis . The following lines can be used for reference -" Paradoxically, at the very moment new information technologies are transforming the United States economy, we are forced to analyze that economy on the basis of data that are often outright misleading"

B. The federal government needs to expand its data collection in order to produce accurate statistics.
There is no mention of expansion of data collection in order to increase accuracy.

D. The federal government would be more cost-efficient if it used private-sector accounting procedures.
There is no mention of cost-efficiency anywhere in the passage

E. The largest single investment the federal government tracks in its accounting procedures is the cost of highways.
The author mentions highways in the second para but it is not mentioned as the largest single investment.

Q4. The author uses paper dips in the comparison drawn in lines 39-41 (Text in Red) most probably in order to emphasize 
My answer is D)
 D. how misleading government statistics can be 
The author is trying to suggest that the government statistics are faulty enough to treat the minuscule investment on things like paper clips at par with the crucial investment made on intellectual capabilities of the workforce i.e. training and education

A. how little the government spends on education and training
The passage actually mentions that the investment made on education and training is crucial . SO the above answer choice is incorrect.

B. what conditions technological change has created for workers
The paper clips comparison is not mentioned to tell anything about impact of technological change on workers

C. how much the economy of the United States has changed
It is nowhere related to the comparison asked in the question.

E. how large the amount spent on work-force education really is
No, thi sis not the idea being conveyed. It certainly mentions the huge investment made on workforce education but the comparison with paer clips is for the accuracy of statistics.

Q5.  Which of the following, if true, most closely resembles the paradoxical situation the author describes in the first paragraph? 
My answer is C)
 C. New building materials have completely changed the way buildings are built, but the only building safety codes available to judge a building's soundness are based solely on old-fashioned materials. 
In this answer choice, the new building materials can be compared to the new technologies whereas the old-fashioned materials can be compared to the outdated datasets mentioned in the paradoxical situation in the first paragraph.

A. Advances in medical knowledge have led to the control of many diseases and thus prolonged lives, but the aging process cannot be arrested.
The arresting of aging process does not resemble to the method or entity of the paradoxical situation in the first para.

B. Perfection of fiber-optic technology has improved telephone service all over the world, but the price of such service continues to escalate.
The metion of price is not apt for the situation mentioned.

D. An increasing number of banks and other financial institutions are investing in higher-risk, higher-yield securities despite the record number of financial institution failures in the past two years.
This sitution does not resemble the paradoxical situation

E. The reported total amount spent in the private sector on training new employees has remained constant, whereas the amount spent on salaries for corporate-training personnel has increased dramatically.
The amount spent in the privat sector on training or salaries does not resemble any entity in the paradoxical situation.

Q6. It can be inferred from the passage that which of the following is true of government statistics in the United States? 
My answer is A)
 A. Some government statistics suggest that in any given year the government is more wasteful than is actually the case. 
This is the idea suggested by the author in the following lines - "Finally and perhaps most important, the government's growing role as art investor in the nation's infrastructure is obscured; thus, government spending appears to be unnecessary or even profligate."

B. Some government statistics report so much detail in so many categories that they are cumbersome to use.
There is no mention of extra detailed report on government statistics.

C. Government statistics arc based on assumptions similar to those that underlie private-sector economic analyses.
The passage actually mentions the opposite i.e. the government statistics are not based on private sector economic analysis assumptions.

D. Accurate governmental statistical information is no longer important to economic analysts.
This is complete incorrect as per the passage

E. Government statistics as a source of economic information have been supplanted by private sector economic analyses.
It is incorrect as can be seen in the following line - "In private industry, standard accounting practice divides a firm's outlays into long-term investment in new plants and equipment and short-term current expenses—wages, salaries, and the cost of supplies. National statistics honor this distinction for private-sector businesses but not for government spending."

8Harshitsharma · Answer

A challenging economics passage, we love to see that!

Quick notes para notes:
P1: A problem (paradox) is stated with a specific example of government investment.
P2: Difference between investment and expense in private vs govt statistics.
P3: More discussion about other obsolete assumptions and examples.

Main point: To stress that government statistics are based on obsolete assumptions using examples and comparisons with private industry assumptions.
 
 A. The contradiction or paradox stated in the first para is never resolved, just explored.
B. Comparison between private industry spending and government spending is in 2nd para only. 
 C. Yes, matches our pre-thought main point the most. 
 D. No explanation of any procedure here.
E. Neither any solution about anything.  
  
 
  All the above points can be inferred from para 2, very clearly.
From the lines below, we can see the problems which will be solved if the government used private accounting practices.
I. "Because government investments are excluded by definition, figures on net investment are regularly underestimated"
II. "And no provision is made to cover the depredation of crumbling roads, sewers, and schools."
III. "Finally and perhaps most important, the government's growing role as art investor in the nation's infrastructure is obscured; thus, government spending appears to be unnecessary or even profligate."

Answer choice E - CORRECT   
 
   A. Not stated anywhere - para 1 states something else - it states a paradox that IT is taking over but information that it is based on is unreliable and full of assumptions.
B. Not stated 
 C. Yes, mentioned several times throughout the passage. 
 D. Nothing in the passage implies that fed govt would be more "cost-efficient", just suggests that it would better account the expenses and investments using private accounting practices.
E. Not stated   
 
Easy to eliminate choices:  A. Not the intention
B. Not the intention
E. Not the intention

Very close comp between C & D,
 C. It is the next bigger idea, which is emphasized using the point of misleading govt statistics. 
 D. Correct choice. The author wants to emphasize that education is an investment and should, hence, be differentiated from expenditures such as stationary items (paper clips).   
 
   A. Not related
B. Not related  
 C. Yes a new system is arriving and bringing up a change in the business, but the data it relies upon is obsolete and misinformed because of assumptions. 
 D. Not related
E. Not related   
 
 A. Only option possible by POE and is supported by the passage from para 2 - "Finally and perhaps most important, the government's growing role as art investor in the nation's infrastructure is obscured; thus, government spending appears to be unnecessary or even profligate." 
 B. Nope, not inferrable. 
C. Nope, not inferrable.
D. Nope, not inferrable.
E. Nope, not inferrable.

Sajjad1994 · Answer

Official Explanation

1. The passage is primarily concerned with

Explanation

The main focus of the passage is to support the assertion that the federal government is facing a crisis in the way it collects, analyzes, and disseminates information. The author presents evidence and examples, such as the faulty assumption in defining government investment and the outdated treatment of education spending, to back up the assertion that the current information practices are problematic.

A.  The passage does highlight contradictions in the way government spending is accounted for, the primary goal is not to resolve these contradictions but to bring attention to them and support the assertion of a crisis in information practices.

B.  The passage makes some comparisons, such as comparing the treatment of government and private-sector spending, the main purpose is not to draw these comparisons but to use them as evidence in support of the overarching assertion.

D.  The passage discusses the flaws in current procedures for collecting and analyzing government information, but the primary goal is not to explain a procedure in detail. Instead, it aims to highlight the issues with existing procedures.

E.  The passage does not focus on proposing solutions to the identified problems but rather on presenting evidence to support the assertion that there is a crisis in the way the federal government handles information.

Answer: C

Sajjad1994 · Answer

Official Explanation

2. It can be inferred from the passage that which of the following would be true if the government used the private-sector accounting practice described in lines 11-14 (Highlighted)

Explanation

I.  This is supported by the passage. The author mentions that the current practice of excluding government investments from national statistics leads to the underestimation of net investment. If the government adopted the private-sector accounting practice, which distinguishes between long-term investment and short-term expenses, it would likely result in a more accurate estimation of net investment.

II.  This is also supported by the passage. The author notes that the current practice lacks provision for the depreciation of government-funded projects, leading to issues with crumbling infrastructure. The private-sector accounting practice, which distinguishes between long-term investment and short-term expenses, typically involves accounting for depreciation on long-term assets. Therefore, if the government adopted this practice, it would likely involve making provisions for the depreciation of long-term projects.

III.  This is supported by the passage. The author argues that the current practice obscures the government's role as an investor in the nation's infrastructure. If the government used the private-sector accounting practice, which recognizes government spending on long-term projects as investments, it would likely result in a clearer and less obscured understanding of the government's role as an investor in the economy.

Answer: E

Sajjad1994 · Answer

Official Explanation

3. Which of the following most accurately restates information in the passage?

Explanation

The passage highlights the crisis in the federal government's information collection and analysis methods. It points out that government statistics are only as good as the assumptions shaping the collection and analysis of data. The example of faulty assumptions in defining government investment is provided, emphasizing how this leads to problems in accurately tracking spending in the economy. The passage argues that government spending, especially in areas like infrastructure and education, is obscured or misrepresented in the statistics, making them misleading. Therefore,  option C  accurately captures the main idea that government statistics do not accurately reflect the economy due to issues in data collection and analysis.

Answer: C

Sajjad1994 · Answer

Official Explanation

4. The author uses paper dips in the comparison drawn in lines 39-41 (Text in Red) most probably in order to emphasize

Explanation

In the passage, the author contrasts the treatment of spending on equipment like machine tools and computers with spending on education and training. The comparison is made to highlight the flawed assumption in government statistics that treats spending on the intellectual capabilities of the workforce no differently from spending on paper clips. This emphasizes the misleading nature of government statistics, as it suggests that a company is considered to be investing when purchasing a new machine, but not when investing in employee training – a discrepancy that contributes to the overall crisis in data collection and analysis discussed in the passage. Therefore,  option D  is the most accurate interpretation of the author's use of the comparison with paper clips.

Answer: D

Sajjad1994 · Answer

Official Explanation

5. Which of the following, if true, most closely resembles the paradoxical situation the author describes in the first paragraph?

Explanation

Answer  option (C)  is correct. In this option, there is a clear contrast between the advancements in building materials, representing technological progress, and the outdated building safety codes, reflecting a lack of synchronization in assessing the soundness of modern constructions. This mirrors the paradox described in the passage, where new information technologies transform the economy, but the government struggles with outdated assumptions in data collection and analysis. Both situations highlight a disconnection between technological advancements and the tools or systems used to evaluate or respond to those advancements. Therefore,  option C  best captures the essence of the paradoxical situation described by the author.

Answer: C

Sajjad1994 · Answer

Official Explanation

6. It can be inferred from the passage that which of the following is true of government statistics in the United States?

Explanation

The passage indicates that government statistics are often misleading due to faulty assumptions and practices in data collection and analysis. For example, the exclusion of certain government expenditures from the category of investments leads to an underestimation of net investment figures. Additionally, the passage highlights that the government's growing role as an art investor is obscured, potentially making government spending appear unnecessary or wasteful. Therefore, option A is a reasonable inference as it aligns with the idea that government statistics may suggest more wastefulness than is actually the case due to the mentioned issues in data representation.

Answer: A

The federal government faces a crisis in the way it collects, analyzes

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GMAT Reading Comprehension (RC) Questions

The federal government faces a crisis in the way it collects, analyzes

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