This is my logic.
1. which of the following best states the central idea of the passage?
(a) the use of mesbic's for aiding minority entrepreneurs seems to have greater potential for success than does the original sba approach.Central idea of the passage. It stated that SBA was a failure and here came the great Mesbic.
(b) there is a crucial difference in point of view between the staff and directors of some mesbic's.Too local. Mentioned only in P3
(c) after initial problems with management and marketing, minority businesses have begun to expand at a steady rate.Too local. Only mentioned in end of P2
(d) minority entrepreneurs wishing to form new businesses now have several equally successful federal programs on which to rely.Do they really have different program? Only SBA (unsuccessful) and Mesbic (better) are mentioned
(e) for the first time since 1960, large corporations are making significant contributions to the development of minority businesses.Maybe it was the first time since 1960. But this is not the central idea. You can maybe infer that it was the first time
2. according to the passage, the mesbic approach differs from the sba approach in that mesbic's
(a) seek federal contracts to provide markets for minority businesses This is SBA approach
(b) encourage minority businesses to provide markets for other minority businesses Out of scope. The passage did not mention having minority bussinesses helping out other small busineeses. Only either SBA (Gov to minority) or Mesbic (Gov -> Investment companies -> small companies)
(c) attempt to maintain a specified rate of growth in the minority business sector"maintain"? did mesbic maintain a growth rate? No mention of mesbic growth rate.
(d) rely on the participation of large corporations to finance minority businesses
Correct. SBA (Gov -> minority) is different with Mesbic (Gov -> investment companies -> minority)
(e) select minority businesses on the basis of their location No mention of selecting due to location of businesses
3. which of the following does the author cite to support the conclusion that the results of the sba program were disappointing?Scan P2 for backup data. Realize that it's the number of receipts. Look for "receipts" in answer choice
(a) the small number of new minority enterprises formed as a result of the program
(b) the small number of minority enterprises that took advantage of the management and technical assistance offiered under the program
(c) the small percentage of the nation's business receipts earned by minority enterprises following the programs, implementation.even 15 years after the program was implemented, minority business receipts were not quite two percent of the national economy's total receipts.
(d) the small percentage of recipient minority enterprises that were able to repay federally guaranteed loans made under the program
(e) the small number of minority enterprises that chose to participate in the program
4. which of the following statements about the sba program can be inferred from the passage?
(a) the maximum term for loans made to recipient businesses was 15 years."After 15 years" cannot be inferred to 15-year loan
(b) business loans were considered to be more useful to recipient businesses than was management and technical assistance.Mentioned of the 3 "since managerial inexperience, unfavorable locations, and capital shortages led to high ..." but did not point out one is superior than others
(c) the anticipated failure rate for recipient businesses was significantly lower than the rate that actually resulted.Passage mentions: "The results were disappointing" means they anticipate success rate to be high (or failure rate to be low) and actual is the opposite: success rate is low (and failure rate is high)
(d) recipient businesses were encouraged to relocate to areas more favorable for business development.No mention
(e) the capitalization needs of recipient businesses were assessed and then provided for adequately.
5. based on information in the passage, which of the following would be indicative of the pragmatism of mesbic staff members? I got this one wrong. I chose A which is I only. Not sure how II is correct...
Ⅰ.a reluctance to invest in minority businesses that show marginal expectations of return on the investments I is obviously correct to me. Directors prefer "risky investments" = "marginal return on investments"
Ⅱ. a desire to invest in minority businesses that produce goods and services likely to be of use to the sponsoring company Not entirely sure about this one.
Ⅲ. a belief that the minority business sector is best served by investing primarily in newly established businesses
(b) Ⅲ only
(c)Ⅰand Ⅱ only
(d)Ⅱ and Ⅲ only
(e)Ⅰ,Ⅱ and Ⅲ
6. the author refers to the "financial and operating problems"(line 38 ) encountered by mesbic's primarily in order to Prethink: How mesbic different with SBA, solves prior problems (not enought of funding)
(a) broaden the scope of the discussion to include the legal considerations of funding mesbic's through sponsoring companies
(b) call attention to the fact that mesbic's must receive adequate funding in order to function effectively"adequate funding" is the key to me
(c) show that sponsoring companies were willing to invest only $500,000 of government-sponsored venture capital in the original mesbic's
(d) compare sba and mesbic limits on minimum funding
(e) refute suggestions that mesbic's have been only marginally successful
7. the author's primary objective in the passage is to Scan first word to have the tone of author
(a) disprove the view that federal efforts to aid minority businesses have been ineffective "disprove" is a pretty strong tone. Do not match with the neutral tone
(b) explain how federal efforts to aid minority businesses have changed since the 1960's Neutral tone. Stay high level. Good overall objective choice.
(c) establish a direct link between the federal efforts to aid minority businesses made before the 1960's and those made in the 1980's
(d) analyze the basis for the belief that job-specific experience is more useful to minority businesses than is general management experience
(e) argue that the "social responsibility approach" to aiding minority businesses is superior to any other approach
8. it can be inferred from the passage that the attitude of some mesbic staff members toward the investments preferred by some mesbic directors can best be described as
(a) defensive Too strong
(c) indifferent The staffs obviously felt different enough
(d) shocked No mention of surprise/shock
(e) disapproving Correct. Staffs think that the directors are wrong in their selection criteria
9. the passage provides information that would answer which of the following questions?
(a) what was the average annual amount, in dollars, of minority business receipts before the sba strategy was implemented?
(b) what locations are considered to be unfavorable for minority businesses?
(c) what is the current success rate for minority businesses that are capitalized by mesbic's?
(d) how has the use of federal funding for minority businesses changed since the 1960's? Match with central idea of passage
(e) how do minority businesses apply to participate in a mesbic program?