In any country, the wages commanded by the labourers who have

Question

In any country, the wages commanded by the labourers who have comparable skills but who work in various industries are determined by the productivity of the least productive unit of labour, that is, the unit of labour which works in the industry which has slightest economic disadvantages. We will represent the various opportunities of employment in a country by Symbols A, B, C, and D. A standing for a group of industries in which we have exceptional economic advantage over foreign countries; B for a group in which our advantages are less; C, one in which they are still less; D, the group of industries in which they are the least of all.

When our population is so small that all our labour can be engaged in the group represented by A, productivity of labour and (therefore wages) will be at their maximum. When our population increases so that some of the labour will have to work in group B, the wages of all labour must decline to the level of productivity in that group. But no employer, without government aid, will yet be able to afford to hire labour to exploit the opportunities, represented by C and D, unless there is a further increase in population.

But suppose that the political party in power holds the belief that we should produce everything that we consume, that the opportunities represented by C and D should also be exploited. The commodities that the industries composing D will produce have been hitherto obtained from abroad in exchange for commodities produce by A and B. The government now renders this difficult by imposing high duties upon the former class of commodities. This means that workers in A and B must pay higher prices for what they buy, but do not receive higher prices for what they sell.   1 
 1. The author of the passage would most likely agree with which of the following?

(A) Population increases always result in lower wages. 
(B) To operate in an industry in which economic advantages are very low, a company will require some external incentive. 
(C) The political party in power has a major say in determining the wage rates in an industry. 
(D) Charging high duties on imported products is one way of regulating domestic wages. 
(E) A country with a smaller population will have a higher average wage rate than a country with a larger population.

2 
 2. According to the information in the passage, which of the following could be the impact of the government’s actions with reference to which economic opportunities to exploit?

(A) The prices of imported products could fall. 
(B) The prices of exported products could fall. 
(C) Certain groups of workers could be negatively impacted. 
(D) The requirements for government aid by industries could go up drastically. 
(E) The domestic wage rates could increase.

3 
 3. The wages for the workers will be highest when which group(s) would dominate?

I. Group A 
II. Group B 
III. Group C 
IV. Group D

(A) Only I 
(B) Only II 
(C) I, II & III 
(D) III & IV 
(E) All the groups

4 
 4. The main idea of the passage is:

(A) To outline the role of the government in the economy 
(B) To analyze the effect population has on wages 
(C) To criticize the foreign policies of the government 
(D) To point out loopholes in wage determination 
(E) To examine industry-wise division of workers

dcummins · Answer

MartyTargetTestPrep  thoughts on this question? I got 2/4 incorrect. Not sure this passage is up to par with OG quality.

MartyTargetTestPrep · Answer

Question 1 is broken. The supposed correct answer is not supported.

The correct answers to questions 2 and 3 are obvious.

The supposed correct answer to question 4 doesn't really match the passage, and choice (E) may be better than the OA.

kas007@india.com · Answer

Sometimes the answer bar is on the top and other times its on the bottom which completely confuses the hell out of me and I mark the wrong stuff.

Sajjad1994 · Answer

Sorry for inconvenience your concern is truly valid and we are going to start a pole in RC forum and will know what members want about the position of the timer. And then will define the same in RC Forum rules, so there will be a one standard for timer position.

Thanks.

cyryl5 · Answer

I have concerns about #1. I was down to B and E and selected E.

The passage states:
"When our population is so small that all our labour can be engaged in the group represented by A, productivity of labour and (therefore wages) will be at their maximum."
(E) A country with a smaller population will have a higher average wage rate than a country with a larger population.

However, in hindsight the smaller and larger populations could still have the same ranking (A,B,C, or D) which means that either could have higher wages. So this makes E problematic, but where is B supported by the passage? I eliminated it because I thought it was out of scope.

cyryl5 · Answer

I also said that E is better here because I thought that analyzing the effect population has on wages is encompassed by examining industry-wise division of workers which also encompasses the discussion about wages.

nimishaks · Answer

Topic 
How are wages of laborers determined

Scope 
An illustration highlighting how economic advantages within certain
industries affect wage rates.

Passage Map 
P 1 – To explain how wages are determined within industries
P 2 & P 3 – To explain how wages vary in relation to the economic
advantages that certain industries in a country have over
foreign countries

1. Answer: B 
Explanation:
The author mentions at the end of the second paragraph that no
employer or firm will be able to exploit the opportunities present in
groups C and D unless the government provides them with some aid
to compensate for the low economic advantages. Thus, (B) is the
correct answer.
(A) Extreme option. If even after the population increase, the
increased population can be absorbed in group A, then this
will not lead to lower wages.
(C) The author merely uses the example of a political party in the
third paragraph. He does not say that this is necessarily the
case. Even if this is the case, the political party merely decided
which activities to undertake, and not the wage rate as such.
(D) Charging high duties is not a way of wage regulation; it can, in
fact, have negative consequences as explained in the passage.
(E) This is on the same lines as option A. The passage never states
that population size is the only determinant of wage rate.
There could be other factors as well.
 2. Answer: C 
Explanation:
The last sentence of the third paragraph clearly shows that workers
in groups A and B could be at a disadvantage were the government
to decide which economic opportunities should be exploited by these
workers. Thus, (C) is the correct answer.
(A) Since the government will impose duties on these products,
their prices will actually increase.
(B) There will be no impact on the prices of these products.
(D) There is nothing in the passage to suggest this.
(E) Most likely, the wage rates will decrease because we are now
exploiting opportunities in groups C and D. The wage rates
would be highest if we only exploited opportunities in group A
or, at the most, group B.
 3. Answer: A 
Explanation:
As can be inferred from para 2, the author has specifically mentioned
the relationship between population and the wages the workers
would earn. It is only with increase in population that other groups
are even considered. Hence, (A) is the correct answer.
 4. Answer: B 
Explanation:
The author has, in para 1, mentioned the relationship between wages
and the least productive unit of labor. He then goes on to explain the
impact that population has on the groups, the effect of legislation on
them as well as the earning capacity. Hence, (B) is the correct
answer.
(A) & (C) The author has limited himself to analyzing a
situation the government might create by changing
priorities—the role of the government or its policies
are not discussed in isolation.
(D) The author has confined himself only to the discussion of how
wages are determined.
(E) As inferred from para 1, ‘In any country…disadvantages’.

dcummins · Answer

Not sure how you can get confused.

TIMER >QUESTION>TIMER >QUESTION...

You need to be more careful dude.

Placing the timer first is more logical and consistent with the rest of the forums in which the standard format is "TIMER QUESTION - Answer choice"

VerbalBot · Answer

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In any country, the wages commanded by the labourers who have

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In any country, the wages commanded by the labourers who have

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