The amount of bonus money that managers take home has declined through

Question

The amount of bonus money that managers take home has declined through the 1990s, causing an exodus of experienced financial services advisors to a variety of nontraditional industries. These industries, while unable to offer competitive salaries and bonuses, have been forced to find creative methods of compensation for productive managers.

The reward for this movement to such diverse industries as  ice-cream manufacturing, microbrewing, and institutional art-dealing  is reaped by both the managers and their new employers. While net profits at investment firms have declined by an average of sixteen percent over the past three years, those of small businesses in nontraditional industries have risen a whopping thirty-eight percent; as managers bring their investment acumen to their new jobs, internal investment plans, pension plans, and health-care plans for small businesses also seem to have entered a more competitive phase.

Moreover, the cutthroat politicking found in the  corporate culture  of the financial services industry is lacking in smaller firms. Faced with the choice between an all-consuming business career and a more flexible work environment that accommodates family and outside interests, managers choose the latter. Such freedom to choose their own level of work commitment may encourage a longer tenure at each company and greater job satisfaction.

Preliminary studies completed by Drs. William Meyers and Beverly Chue seem to indicate that while monetary remuneration is on the decline, the community involvement of these transplanted executives has resulted in unanticipated levels of satisfaction. Executives who had moved from the financial services industry to nontraditional industries were four times more likely to report involvement in extraprofessional organizations as "rewarding" or “very rewarding." Not surprisingly, incidents of stress-related illness among these executives were only half as frequent.

Drs. Meyers and Chue are quick to point out, however, that the contributing effect of various cofactors could not be completely assessed. Such possible contributory factors cited were location, age, marital status, prior health history, and the state of personal financial affairs prior to switching occupations. Any of these, both authors point out, could be statistically significant with respect to the effects cited as results of changing occupations.    1 
 1. The primary purpose of the passage is to

A. explore an old phenomenon in the light of new evidence
B. reevaluate the contributions of one occupation
C. point out increasing difficulties in the financial sector
D. examine the reasons behind and impact of a phenomenon
E. explain the reasoning behind a proposed change in corporate structure

2 
 2. The author of the passage cites “ice-cream manufacturing, microbrewing, and institutional art-dealing" ( Highlighted ) in order to

A. show the diversity of nontraditional industries that financial managers have entered
B. describe the industries most significantly harmed by this exodus of talent
C. illustrate the variety of problems associated with the financial industry's corporate downsizing
D. provide examples of industries with a higher level of job satisfaction than that found in the financial services industry
E. explain the reasons for contemporary profit increases in smaller, more nontraditional industries

3 
 3. Which of the following is an assumption underlying the information presented in the first paragraph of the passage?

A. There was no cause for the managerial exodus more significant than the decrease in bonus levels.
B. Nontraditional industries provide more comprehensive benefits than does the financial services industry.
C. The rise in profits at nontraditional industries is due to the influx of financial managers.
D. A longer tenure at a given company leads to greater managerial and experiential efficiencies.
E. Prior to 1990, bonus levels in the financial services industry were consistently rising.

4 
 4. The author believes that the “corporate culture" described in line 24 is best characterized by which of the following?

A. A massive exodus of financial managers to nontraditional businesses
B. A creative method employed by nontraditional businesses of remunerating managers
C. A mental stress associated with the long hours of an all-consuming occupation
D. A deteriorating effect of the demands of certain jobs on time and family
E. A competitive and unsupportive environment fostered in the financial services industry

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 Passage # 06  |  Date: 03 March 2022 
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Hoozan · Answer

P1:  Low bonus has lead to financial managers shifting from the finance industry to other nontraditional industry

P2:  Shift of financial managers has benefited both, the managers as well as the small business house

P3:  Benefits of working in a nontraditional industry

P4:  Monetary benefits < Job satisfaction, sense of belongingness, health

P5:  Shift to nontraditional industries COULD be the reason why the financial managers are happy BUT there could be other factors as well - location, age, marital status, etc.
----------------------------------------------------------------------------------------------------------------------------------------------------------
 1. The primary purpose of the passage is to

A. explore an  old phenomenon  in the  light of new evidence  -  Incorrect   - What "old" phenomenon are we talking about? Is it the shift of managers to nontraditional industries? but since it happened through the 1990s I don't think this phenomenon is that old. Most importantly, what "new evidence" are we talking about? Even if this doesn't convenience you, then just look at the summary above and ask yourself, does (A) truly cover the essence of all the points mentioned above?

B.  reevaluate   the contributions  of one occupation -  Incorrect  - We are not r e evaluating anything out here. The passage is simply presenting us information about a particular trend of job shifts. Moreover, there is no contribution covered. YES, the passage does say (in P2) that the managers and the small businesses have benefited but that's about it. This is nowhere close to "contributions of  one occupation "

C. point out  increasing difficulties  in the financial sector -  Incorrect   - Yes, the financial sector has seen a drop in its profits "While net profits  at investment firms have declined  by an average of sixteen percent over the past three years" BUT this barely covers one small aspect of the entire passage let alone talk about the "difficulties". By analyzing the summary of the passage, it is clear that our answer choice will have something to do with a trend in the financial industry, moreover, information about the financial advisors who choose this job shift

D. examine the reasons behind and impact of a phenomenon
– Correct,
Phenomenon – changing occupations
Reason – low reward, High politicking, low job satisfaction and High stress
Impact – Job change, but depending upon contributory factors

E. explain the reasoning behind  a proposed change  in  corporate structure  -  Incorrect  - There is no change that is being proposed. The financial advisors CHOSE to shift to nontraditional industries since financial industries were unable to offer competitive salaries and bonuses, Moreover, the author is not focusing on any corporate structure. Rather he is more interested to highlight the benefits/positive impact of this trend on the financial advisors

Correct Answer:  (C)  
----------------------------------------------------------------------------------------------------------------------------------------------------------
 2. The author of the passage cites “ice-cream manufacturing, microbrewing, and institutional art-dealing"  (Highlighted)  in order to

"The reward for this movement to   such  diverse industries    as   ice-cream manufacturing, microbrewing, and institutional art-dealing is reaped by both the managers and their new employers." By using the marker "Such as" the author is providing us with examples of industries. What kind of industries? The ones to which the financial advisors have moved and thus repeating rewards.

A. show the diversity of nontraditional industries that financial managers have entered -  Correct   - for the reasons stated above

B. describe the industries  most significantly harmed  by this exodus of talent -  Incorrect   - Quite the opposite. The industries have benefited from this shift "those (profits) of  small businesses in nontraditional industries have risen  a whopping thirty-eight percent"

C. illustrate the  variety of problems  associated with the  financial industry's corporate downsizing  - Incorrect - This is not even related to the highlighted text. All the highlighted text does is talk about the nontraditional industries

D. provide examples of industries with a higher level of job satisfaction than that found in the financial services industry - Incorrect - Yes, these COULD be the industries that provide a higher level of job satisfaction BUT that is not why the highlighted text is given. (read the explanation of option A)

E.  explain the reasons  for contemporary profit increases in smaller, more nontraditional industries -  Incorrect   - The highlighted text merely illustrates the nontraditional industries to which the financial advisors have shifted. There aren't "reasons" that are mentioned.

Correct Answer:  (A)  
----------------------------------------------------------------------------------------------------------------------------------------------------------
 3. Which of the following is an assumption underlying the information presented in the first paragraph of the passage?

" The amount of bonus  money that managers take home  has declined  through the 1990s,  causing an exodus of experienced financial services advisors  to a variety of nontraditional industries."

Clearly the author has assumed that the drop in bonuses is the cause of the managerial exodus.    At this point, our SC concepts would be of great help. We have a clause modifier "causing" modifying the previous clause thus stating the RESULT for a particular action. What is the result? Managerial exodus. What is the cause? drop in bonus

A. There was no cause for the managerial exodus more significant than the decrease in bonus levels. -  Correct  - If there was a cause more significant then the author could not have arrived at the result (managerial exodus) based solely on the drop in bonus.
B. Nontraditional industries provide more comprehensive benefits than does the financial services industry.
C. The rise in profits at nontraditional industries is due to the influx of financial managers.
D. A longer tenure at a given company leads to greater managerial and experiential efficiencies.
E. Prior to 1990, bonus levels in the financial services industry were consistently rising.

Correct Answer:  (A)   
----------------------------------------------------------------------------------------------------------------------------------------------------------
 4. The author believes that the “corporate culture" described in line 24 is best characterized by which of the following?

"the cutthroat  politicking  found in the corporate culture of the financial services industry"  I have no idea what politicking means but since it begins with "poli" I believe it has something to do with "politics" moreover with "office politics" (since we are talking about corporate culture). At the least what I could say (after reading the passage) is that the financial industry (to put it simply) is not good for financial advisors. So "politicking" will be some negative word for the corporate culture of the financial industry.

A. A massive exodus of financial managers to nontraditional businesses
B. A creative method employed by nontraditional businesses of remunerating managers
C. A mental stress associated with the long hours of an all-consuming occupation
D. A deteriorating effect of the demands of certain jobs on time and family
E. A competitive and unsupportive environment fostered in the financial services industry -  Correct  - Again, when I look at the words "competitive" and "unsupportive environment" all I can think of is "unhealthy work environment for financial advisors" a.k.a office politics!

Correct Answer:  (E)

ElninoEffect · Answer

1. The primary purpose of the passage is to

A. explore an old phenomenon in the light of new evidence
I call this option irrelevant
B. reevaluate the contributions of one occupation
Same as A
C. point out increasing difficulties in the financial sector
There are other things also being discussed in this passage besides difficulties of financial sector.
 D. examine the reasons behind and impact of a phenomenon 
It sums up the entire passage.
E. explain the reasoning behind a proposed change in corporate structure
1st it doesn't actually sum up the entire passage and secondly, a general phenomenon has been discussed not particularly a change in a corporate structure.

2. The author of the passage cites “ice-cream manufacturing, microbrewing, and institutional art-dealing" ( Highlighted ) in order to

A. show the diversity of nontraditional industries that financial managers have entered 
Sounds up right.
B. describe the industries most significantly harmed by this exodus of talent
Just the opposite.
C. illustrate the variety of problems associated with the financial industry's corporate downsizing
Not at all relevant or has been discussed.
D. provide examples of industries with a higher level of job satisfaction than that found in the financial services industry
It's a possibility(job satisfaction), not an affirmation. (notice the use of may)
E. explain the reasons for contemporary profit increases in smaller, more nontraditional industries
The reason is managers entering these fields, not the industries themselves.

3. Which of the following is an assumption underlying the information presented in the first paragraph of the passage?

A. There was no cause for the managerial exodus more significant than the decrease in bonus levels. 
 The amount of bonus money that managers take home has declined through the 1990s, causing an exodus of experienced financial services advisors to a variety of nontraditional industries. 
This assumption sums up correct for the conclusion to be true.
B. Nontraditional industries provide more comprehensive benefits than does the financial services industry.
If anything just the opposite.
C. The rise in profits at nontraditional industries is due to the influx of financial managers.
This is discussed in the second paragraph. So irrelevant.
D. A longer tenure at a given company leads to greater managerial and experiential efficiencies.
Irrelevant.
E. Prior to 1990, bonus levels in the financial services industry were consistently rising.
We cannot infer that and it's not necessary for the conclusion to hold.

4. The author believes that the “corporate culture" described in line 24 is best characterized by which of the following?

We are basically trying to define the term "cutthroat politicking" & only option E defines it perfectly.
A. A massive exodus of financial managers to nontraditional businesses
B. A creative method employed by nontraditional businesses of remunerating managers
C. A mental stress associated with the long hours of an all-consuming occupation
D. A deteriorating effect of the demands of certain jobs on time and family
 E. A competitive and unsupportive environment fostered in the financial services industry

zhanbo · Answer

Question 1 : My answer is  (D) .
(A) If not for this option, I would not know this is "an old phenomenon". If the "new evidence" refers to "preliminary studies completed by Drs. William Meyers and Beverly Chue", it helps explain the impact of the phenomenon but does not somehow recast the exploration in new light. 
(B) If "one occupation" refers to "financial services advisory", its contribution is not discussed. If "one occupation" refers to “financial management occupations in nontraditional industries", they do contribute to the financial gains in those industries. But this is hardly a reevaluation, nor is it the primary focus of the passage. 
(C) Definitely not the primary focus of the passage. 
(D) Great answer that mentioned both "reasons" and "impact" of the phenomenon. 
(E) There is no proposed change proffered in the reading.

Question 2 : My answer is  (A) . This is the simplest question of this set. 
In ”such diverse industries as ice-cream manufacturing, microbrewing, and institutional art-dealing“， ice-cream manufacturing, microbrewing, and institutional art-dealing are put forward as examples of "such diverse industries". 
(A) indicates the purpose of the list of nontraditional industries.

Question 3 : My answer is  (A) . 
"Assumption" questions in RC are not exactly the same as those in CR. 
(A) Very likely to be the answer. After all, only the decrease in bonus levels is mentioned in the first paragraph.
(B) No. These industries were unable to offer competitive salaries and bonuses.
(C) Not discussed in the first paragraph. 
(D) Not discussed in the first paragraph. (Besides, in the third paragraph, the last sentence only mentions the possibility of longer tenure.)
(E) We cannot make such claim or assumption. We can only believe bonus levels were not in decline prior to 1990.

Question 4 . My answer is  (E) . In my opinion, this is the hardest question in this set. 
The corporate culture is immediately associated with "the cutthroat politicking". We need to keep this in mind. 
(A) Is it "massive"? Not supported in the texts. 
(B) This culture refers to the corporate culture  of the financial services industry 
(C) An attractive answer choice. In the second sentence of the third paragraph, "an all-consuming business career" is associated with "the corporate culture". Keep for now. 
(D) Another attractive answer choice. It is indirectly mentioned in the third paragraph.
(E) Yet another attractive answer choice. "competitive" is a paraphrase of "the cutthroat". "unsupportive" can be construed to mean the demand on the time and family.
Usually, we only have two contenders to make the final pick. Now, (CDE) are all attractive. (D) is less plausible because it is only referred to indirectly. 
Ultimately (and at the first pass), I chose (E) mainly swayed by the close meaning between "competitive" and "cutthroat".

Archit3110 · Answer

1. The primary purpose of the passage is to

A. explore an old phenomenon in the light of new evidence
B. reevaluate the contributions of one occupation
C. point out increasing difficulties in the financial sector
D. examine the reasons behind and impact of a phenomenon
 E. explain the reasoning behind a proposed change in corporate structure  correct option

2. The author of the passage cites “ice-cream manufacturing, microbrewing, and institutional art-dealing" (Highlighted) in order to

A. show the diversity of nontraditional industries that financial managers have entered
B. describe the industries most significantly harmed by this exodus of talent
C. illustrate the variety of problems associated with the financial industry's corporate downsizing
 D. provide examples of industries with a higher level of job satisfaction than that found in the financial services industry 
correct option ; provides reason
E. explain the reasons for contemporary profit increases in smaller, more nontraditional industries

3. Which of the following is an assumption underlying the information presented in the first paragraph of the passage?

A. There was no cause for the managerial exodus more significant than the decrease in bonus levels.  correct ; given in the first para
B. Nontraditional industries provide more comprehensive benefits than does the financial services industry.
C. The rise in profits at nontraditional industries is due to the influx of financial managers.
D. A longer tenure at a given company leads to greater managerial and experiential efficiencies.
E. Prior to 1990, bonus levels in the financial services industry were consistently rising.

4. The author believes that the “corporate culture" described in line 24 is best characterized by which of the following?

A. A massive exodus of financial managers to nontraditional businesses
B. A creative method employed by nontraditional businesses of remunerating managers
C. A mental stress associated with the long hours of an all-consuming occupation
D. A deteriorating effect of the demands of certain jobs on time and family
 E. A competitive and unsupportive environment fostered in the financial services industry

ShivaniCh12 · Answer

1. The primary purpose of the passage is to

A explore an old phenomenon in the light of new evidence
B.  reevaluate the contributions of one occupation -infer from passage reasons for shift from financial to non traditional industries.
C. point out increasing difficulties in the financial sector
D. examine the reasons behind and impact of a phenomenon
E. explain the reasoning behind a proposed change in corporate structure

2- . The author of the passage cites “ice-cream manufacturing, microbrewing, and institutional art-dealing" (Highlighted) in order to

A. show the diversity of nontraditional industries that financial managers have entered
B. describe the industries most significantly harmed by this exodus of talent
C. illustrate the variety of problems associated with the financial industry's corporate downsizing
D. provide examples of industries with a higher level of job satisfaction than that found in the financial services industry
E.  explain the reasons for contemporary profit increases in smaller, more nontraditional industries
 - infer from lines 7-11

3-Which of the following is an assumption underlying the information presented in the first paragraph of the passage?

A. There was no cause for the managerial exodus more significant than the decrease in bonus levels.
B.  Nontraditional industries provide more comprehensive benefits than does the financial services industry. - Infer from line " The amount of bonus money that managers take home has declined through the 1990s, causing an exodus of experienced financial services advisors to a variety of nontraditional industries"
C. The rise in profits at nontraditional industries is due to the influx of financial managers.
D. A longer tenure at a given company leads to greater managerial and experiential efficiencies.
E. Prior to 1990, bonus levels in the financial services industry were consistently rising.

4- The author believes that the “corporate culture" described in line 24 is best characterized by which of the following?

A. A massive exodus of financial managers to nontraditional businesses
B. A creative method employed by nontraditional businesses of remunerating managers
C.  A mental stress associated with the long hours of an all-consuming occupation - Infer from line 15-16 "Such freedom to choose their own level of work commitment may encourage a longer tenure at each company and greater job satisfaction"
D. A deteriorating effect of the demands of certain jobs on time and family
E. A competitive and unsupportive environment fostered in the financial services industry

Sajjad1994 · Answer

Competition mode is off now

OAs are:

DAAE

Hoozan  PERFECT! 10/10

zhanbo  10/10

ElninoEffect  8/10

ShivaniCh12  5/10

Good luck with the upcoming questions!

100mitra · Answer

Words:   349
  Read Time:   4 mins 
  Paragraph Style:   Highlighted a phenomenon, with some advantages and open to discussion conclusion 
  Paraphrasing   
 Para 1:  An exodus of experienced financial services is not only due to less compensation for productive managers.
 Para 2:  Compared to managers of investment firms, managers of small non-traditional industries reap more rewards as these managers generate more revenue by facing more competitive phase
 Para 3:  Advantages with smaller firm are lack of politicking, ease with work flexibility, encourage longer tenure, and job satisfaction.
 Para 4:  Studies suggests rather than monetary remuneration, level of satisfaction has increased with-in executives, who moved into non-traditional industries, are now with half of stress related illness. 
 Para 5:  Open for discussion conclusion depending upon contributory factors, which statistically significant with respect to the effects cited as results of changing occupations.

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1. The primary purpose of the passage is to  
A. explore an old phenomenon in the light of new evidence
  - Wrong,   passage tone is not with “Old phenomenon” to “its light of new evidence”
B. re-evaluate the contributions of one occupation 
  - Wrong,   no re-evaluation, irrelevant 
C. point out increasing difficulties in the financial sector 
  - Wrong,   out of scope
  D. examine the reasons behind and impact of a phenomenon 
– Correct, 
 Phenomenon  – changing occupations
 Reason  – low reward, High politicking, low job satisfaction and High stress
 Impact  – Job change, but depending upon contributory factors    
E. explain the reasoning behind a proposed change in corporate structure 
  - Wrong,   no proposed change discussed

-----------------------------------------------------------------------------------------------------------------------------------------------------------

2. The author of the passage cites  “ice-cream manufacturing, microbrewing, and institutional art-dealing"  in order to  
as mentioned in the passage, “ The reward for this movement to such diverse industries as ice-cream manufacturing, microbrewing, and institutional art-dealing ”
  A. show the diversity of non-traditional industries that financial managers have entered
- Correct, as mentioned in the 1st line of the paragraph 2.

B. describe the industry’s most significantly ( harmed by this exodus of talent )   - Wrong,   irrelevant

C. illustrate the variety of problems associated with the financial industry's corporate downsizing   - Wrong,  
passage highlights more about other good side of non-traditional industries, and employees are joining them, 
not about problem associated with of corporate employee leaving financial industry’s

D. provide examples of industries with a higher level of job satisfaction than that found in the financial services industry
  - Wrong,   above mentioned are example of diverse industries not about financial service industry

E. explain the reasons for ( contemporary profit ) increases in smaller, more non-traditional industries   - Wrong,   irrelevant

-----------------------------------------------------------------------------------------------------------------------------------------------------------

3. Which of the following is an assumption underlying the information presented in the first paragraph of the passage?

A. There was no cause for the managerial exodus more significant than the decrease in bonus levels.
Correct – as mentioned in the 1st para of the passage, it was assumed, employee leaving the job was due to low compensation benefits.  
B. Non-traditional industries provide more comprehensive benefits than does the financial services industry.
  - Wrong,   throughout passage, its mentioned in para 2, 3 and 4
C. The rise in profits at non-traditional industries is due to the influx of financial managers.
  - Wrong,   as mentioned in para 3, not para 1, the rise in profits is due to 
, “as managers bring their investment acumen to their new jobs, internal investment plans, pension plans, and health-care plans for small businesses”. 
D. A longer tenure at a given company leads to greater managerial and experiential efficiencies.
  - Wrong,   - irrelevant in terms of 1st paragraph, as no information provided about it.
E. Prior to 1990, bonus levels in the financial services industry were consistently rising.
  - Wrong,   Out of scope, passage relate not information before 1990.

-----------------------------------------------------------------------------------------------------------------------------------------------------------

4. The author believes that 
the “corporate culture" described in  line 24  is best characterized 
by which of the following?

as mentioned in the passage, “ Moreover, the cutthroat politicking found in the corporate culture of the financial services industry is lacking in smaller firms .”
 Cutthroat politicking found in corporate culture  – is about an activity in which people compete with each other in aggressive and unfair ways
  Correct option: E. A competitive and unsupportive environment fostered in the financial services industry

Eliminate rest all, as it does not refer to cut throat politicking or compete with unfair ways  
A.  (A massive exodus)  of financial managers to non-traditional businesses
B. A creative method  (employed by non-traditional businesses)  of remunerating managers
C.  (A mental stress)  associated with the long hours of an all-consuming occupation
D.  (A deteriorating effect)  of the demands of certain jobs on time and family

Foreheadson · Answer

Can someone explain why the question #4 assumes that corporate culture is unsupportive? That single word made me go for C. There may be some people in companies that support you, for example boss or colleagues. the main idea is about leaving the organization for tight schedule and decreasing benefits. Nothing is stated about support. Is it the weakness of the test or am I crazy?

VKat · Answer

Hello Team,

Please let e know the reason of eliminating option D in Q4.

I selected op D because the line25,26.. talks about family and outside interests, so I thought this option is more relatable to what written in the lines 24,25 and 26...

Sajjad1994 · Answer

Read explanation in the post in the link below https://gmatclub.com/forum/the-amount-o ... l#p2976144

VerbalBot · Answer

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