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# In the Wealth of Nations (1776), Scottish economist Adam Smith...

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Updated on: 23 Mar 2018, 11:22
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Question 1
00:00

Question Stats:

47% (01:15) correct 53% (01:47) wrong based on 554

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Question 2
00:00

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53% (00:35) correct 47% (00:42) wrong based on 523

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Question 3
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59% (00:37) correct 41% (00:24) wrong based on 509

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In the wealth of nations (1776), Scottish economist Adam Smith asserted that the propensity of “truck, barter and exchange” was both the foundation of commerce and a given quality of human nature, driven by individual desire. Smith’s view that self-interest dominated the business that emerged in early modern (sixteenth- and seventeenth century) England has had tremendous effects on how such relations have been perceived. Today it is typically assumed, for instance, that the development of business relations weakened the spirit of cooperation that characterized village communities and encouraged a spirit of individualism and self-betterment that ran counter to community interest.

However, such a view fails to account for the language that people in early modern England used to articulate their understanding of business relations, language that stressed credit, trust, obligations, and contracts, rather than self-interest. Throughout this period, most business transactions were conducted on credit – of plain dealing and of the keeping of promises – dominated the way in which business relations were conceived. Individual profit and solvency were important, but neither could be achieved without the trust and direct cooperation of one’s neighbours. As a result, buying and selling, far from breaking up communities, actually created numerous bonds that held villages together.

The author of the passage refers to “truck, barter and exchange” in the highlighted text most likely in order to

(a) lend authority to the argument that commerce is characterized by self-interest
(b) identify activities that embody essential qualities of human relationships
(d) represent the everyday speech used in village communities in England
(e) introduces key terms used in credit transactions in early England
[Reveal] Spoiler:

C

It can be inferred that the author of the passage believes that economic historians whose views have been influenced by Adam Smith have failed to examine which of the following?

(a) The power of business relations to shape moral values and beliefs
(b) The significance of human nature in shaping economic developments and social structure
(c) The importance of village communities in determining the economic well-being of larger society
(d) The consequence of individual communities of changes in a country’s economic structure
(e) The actual language used to by people in village communities to refer to their business dealings
[Reveal] Spoiler:

E

The passage is primarily concerned with which of the following?

(a) Criticizing a theory of human nature
(b) Evaluating the impact of a particular economist on modern theories of economic history
(c) Chronicling the early history of the use of credit in business relations
(e) Explaining the decline of cooperation in village communities
[Reveal] Spoiler:

D

[Reveal] Spoiler: Question #1 OA
[Reveal] Spoiler: Question #2 OA
[Reveal] Spoiler: Question #3 OA

Originally posted by DensetsuNo on 26 Jul 2016, 02:43.
Last edited by GMATNinjaTwo on 23 Mar 2018, 11:22, edited 2 times in total.
fixed typo in passage
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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28 Jul 2016, 01:33
i think it is C
this is short and hard passage. I like to read this type of passage . but I dont see many passage of this type.
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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28 Jul 2016, 01:51
thangvietnam wrote:
i think it is C
this is short and hard passage. I like to read this type of passage . but I don't see many passage of this type.

I added two additional questions from this stem to the first post. $$;)$$
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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28 Jul 2016, 12:17
Just wondering, were you scoring around 700+ when you saw these questions? Thought passage was somewhat easier.
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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28 Jul 2016, 12:55
bballallstar6464 wrote:
Just wondering, were you scoring around 700+ when you saw these questions? Thought passage was somewhat easier.

It's hard to say what the score was halfway through the simulation, but yeah from the final score they should be in the lower end of the 700s.
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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04 Sep 2016, 05:00
Took 7 mins, 30 seconds. Question is definitely in the 720+ range.

B E D was my answer . Got the first one incorrect .

Thanks for this passage.
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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09 Oct 2016, 14:55
DensetsuNo I got 2/3 correct. I was down to option C and option E and picked up on the wrong one.

Can you throw light on the correctness of option C in Q1.

Thank You.
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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23 Oct 2016, 05:01
Can some explain for above RC

For Q3: Primary purpose
Please explain why A or B is incorrect and D is the right answer.
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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24 Oct 2016, 00:17
Tough Passage. Can someone please provide the proper reasoning for all the questions?
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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31 Oct 2016, 03:18
3/3 , 1.45 minute / question.
I find RC quite easy when I make practice; yet, in the CAT simulations I struggle a lot (e.g, in the last one I got half wrong). I think mine is a stamina issue.
The only way is to keep training :D
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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Updated on: 13 Dec 2017, 01:28
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let us read the passage -
sentence 1 talks about Adam Smith's assertion that propensity to truck, barter and trade was foundation of commerce and driven by human desire. The 2nd sentence expands on the first by stating that Smith's views have had tremendous impact on how business relations have been perceived.
the 3rd sentence explains the impact - it is typically assumed that business relations discouraged cooperation.
Note the usage of the word 'typically'. It is an indication that the author will disagree with the statement.

Para 2 - Note the usage of the word 'however'. the author disagrees with the last statement in paragraph 1. the rest of the paragraph then expands on this.

The last sentence - 'As a result, buying and selling, far from breaking up communities actually created numerous bonds that held villages together' - is the conclusion.

Question 3.
A - there is no mention of any 'theory of human nature'. the passage criticizes some 'assumptions held on the impact of the development of business relations'.
B - there is no mention of 'modern theories of economic history'.
C - there is no timeline/chronicle. Also, the main idea of the passage is not about the history of the use of credit in business transactions.
D - correct answer. "accepted ideas" = "typically assumed".
E - the second paragraph states exactly the opposite.

Question 1
Let us read the first two sentences.
A - "lend authority to the argument" - the author does not mention any argument besides that of Smith. Nor is the first sentence supporting any argument.
B - no mention of "human relationships". the passage states that the highlighted text is a given quality of human nature.
the passage does not talk about "essential qualities" only about A "given nature"
D - "everyday speech" is not mentioned in the first paragraph.
E - Not mentioned in the first paragraph.

Question 2
"however, such a view fails to account for the language that people in early england used to articulate their understanding of business relations".

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Originally posted by CrackVerbalGMAT on 02 Nov 2016, 23:06.
Last edited by CrackVerbalGMAT on 13 Dec 2017, 01:28, edited 2 times in total.
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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10 Sep 2017, 12:45
@Gmatninja, Experts,

Why is C incorrect ?

and why is E correct ?
Is E a DOUBLE TRICK answer choice as when i read it i could trace it back to the 1st line of para 2 but i thought that its not referring to the "language used" in literal sense and in figurative sense.

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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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26 Sep 2017, 08:50
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Expert's post
kunal1608 wrote:

Why is C incorrect ?

and why is E correct ?
Is E a DOUBLE TRICK answer choice as when i read it i could trace it back to the 1st line of para 2 but i thought that its not referring to the "language used" in literal sense and in figurative sense.

The passage suggests that historians influenced by Adam Smith believe that the development of business relations weakened the spirit of cooperation that characterized village communities, but it does not suggest that those historians failed to examine the IMPORTANCE of those village communities in determining the economic well being of a larger society. That's why (C) doesn't work.

Choice (E) is not a trick answer (and in general, dismissing anything as a "trick answer" or "trick question" is very unlikely to help you develop a deeper understanding of the GMAT). The first sentence of the second paragraph tells us that those historians failed to account for the language that people in early modern England used to articulate (i.e. communicate) their understanding of business relations. We can infer that the actual language used by people in the villages to refer to their business dealings would be encompassed by this general statement about the language. Thus, choice (E) is the best answer.

I hope this helps!
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All GMAT Ninja articles on GMAT Club | Using LSAT for GMAT CR & RC |7 reasons why your actual GMAT scores don't match your practice test scores | How to get 4 additional "fake" GMAT Prep tests for $29.99 | Time management on verbal Manager Joined: 11 Jun 2016 Posts: 75 Location: India GMAT 1: 680 Q49 V35 GMAT 2: 690 Q49 V34 GPA: 3.4 Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink] ### Show Tags 26 Sep 2017, 10:00 GMATNinja wrote: kunal1608 wrote: Choice (E) is not a trick answer (and in general, dismissing anything as a "trick answer" or "trick question" is very unlikely to help you develop a deeper understanding of the GMAT). I hope this helps! Thankyou I guess this is one of those “finding the detail” type question. Sent from my iPhone using GMAT Club Forum mobile app Intern Joined: 07 Oct 2016 Posts: 13 Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink] ### Show Tags 30 Sep 2017, 04:57 GMATNinja Thanks for ur explanation!! I am having a problem marking off A. End of first paragraph states that " development of business relations has caused has weakened the spirit of cooperation......counter to community interest ". Taking this into consideration the author mentions his views and in the second paragraph (second line) states that "most business transactions were .........villages together". Do these lines not account for option A. Could u please give ur perspective on this. Thanks. GMAT Club Verbal Expert Status: GMAT and GRE tutor Joined: 13 Aug 2009 Posts: 1603 Location: United States GMAT 1: 780 Q51 V46 GMAT 2: 800 Q51 V51 GRE 1: 340 Q170 V170 Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink] ### Show Tags 19 Oct 2017, 21:26 gmatdemolisher1234 wrote: GMATNinja Thanks for ur explanation!! I am having a problem marking off A. End of first paragraph states that " development of business relations has caused has weakened the spirit of cooperation......counter to community interest ". Taking this into consideration the author mentions his views and in the second paragraph (second line) states that "most business transactions were .........villages together". Do these lines not account for option A. Could u please give ur perspective on this. Thanks. This post refers to question #2... Quote: (A) The power of business relations to shape moral values and beliefs. The passage does not suggest that those historians failed to consider the power of business relations to shape moral values and beliefs. In fact, the last sentence of the first paragraph demonstrates that those historians felt that business relations had the power to weaken the spirit of cooperation and encourage of individualism. In other words, the author and those historians would disagree about how business relations shaped moral values and beliefs but not about whether business relations have the power to shape a moral values and beliefs. As described in this post, choice (E) is a better answer. I hope that helps _________________ GMAT Club Verbal Expert | GMAT/GRE tutor @ www.gmatninja.com (Now hiring!) | GMAT blog | Food blog | Notoriously bad at PMs Beginners' guides to GMAT verbal Reading Comprehension | Critical Reasoning | Sentence Correction YouTube LIVE verbal webinars Series 1: Fundamentals of SC & CR | Series 2: Developing a Winning GMAT Mindset -- Wednesdays, February 14 - April 4! SC & CR Questions of the Day (QOTDs), featuring expert explanations All QOTDs | Subscribe via email | RSS Need an expert reply? Hit the request verbal experts' reply button -- and please be specific about your question. Feel free to tag @GMATNinja and @GMATNinjaTwo in your post. Sentence Correction articles & resources How to go from great (760) to incredible (780) on GMAT SC | That "-ing" Word Probably Isn't a Verb | That "-ed" Word Might Not Be a Verb, Either | No-BS Guide to GMAT Idioms | "Being" is not the enemy | WTF is "that" doing in my sentence? Reading Comprehension, Critical Reasoning, and other articles & resources All GMAT Ninja articles on GMAT Club | Using LSAT for GMAT CR & RC |7 reasons why your actual GMAT scores don't match your practice test scores | How to get 4 additional "fake" GMAT Prep tests for$29.99 | Time management on verbal

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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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13 Nov 2017, 08:23
In the wealth of nations (1776), Scottish economist Adam Smith asserted that the propensity of “truck, barter and exchange” was both the foundation of commerce and a given quality of human nature, driven by individual desire. Smith’s view that self-interest dominated the business that emerged in early modern (sixteenth- and seventeenth century) has had tremendous effects on how such relations have been perceived. Today it is typically assumed, for instance, that the development of business relations weakened the spirit of cooperation that characterized village communities and encouraged a spirit of individualism and self-betterment that ran counter to community interest.

However, such a view fails to account for the language that people in early modern England used to articulate their understanding of business relations, language that stressed credit, trust, obligations, and contracts, rather than self-interest. Throughout this period, most business transactions were conducted on credit – of plain dealing and of the keeping of promises – dominated the way in which business relations were conceived. Individual profit and solvency were important, but neither could be achieved without the trust and direct cooperation of one’s neighbours. As a result, buying and selling, far from breaking up communities, actually created numerous bonds that held villages together.

It can be inferred that the author of the passage believes that economic historians whose views have been influenced by Adam Smith have failed to examine which of the following?
(a) The power of business relations to shape moral values and beliefs
(b) The significance of human nature in shaping economic developments and social structure
(c) The importance of village communities in determining the economic well-being of larger society
(d) The consequence of individual communities of changes in a country’s economic structure
(e) The actual language used to by people in village communities to refer to their business dealings

The passage is primarily concerned with which of the following?
(a) Criticizing a theory of human nature
(b) Evaluating the impact of a particular economist on modern theories of economic history
(c) Chronicling the early history of the use of credit in business relations
(e) Explaining the decline of cooperation in village communities

The author of the passage refers to “truck, barter and exchange” in the highlighted text most likely in order to
(a) lend authority to the argument that commerce is characterized by self-interest
(b) identify activities that embody essential qualities of human relationships
(d) represent the everyday speech used in village communities in England
(e) introduces key terms used in credit transactions in early England
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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14 Nov 2017, 07:21
GMATNinja, Could you help with Question 3?
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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16 Nov 2017, 14:57
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hazelnut wrote:
GMATNinja, Could you help with Question 3?

The passage is primarily concerned with which of the following?

Quote:
(A) Criticizing a theory of human nature

According to Adam Smith, the "truck, barter, and exchange" system was a product of human self-interest. Although the author criticizes this view, the author is not trying to say anything about human nature in general. Maybe people are self-interested in general. Regardless, the author is only concerned with whether the BUSINESS RELATIONS of that time were dominated by self-interest. in other words, the author is primarily concerned with the business relations, not human nature itself. Eliminate (A).

Quote:
(B) Evaluating the impact of a particular economist on modern theories of economic history

The author does mention that Smith's view "has had tremendous effects on how such relations have been perceived." However, is the author's primary intention to examine how Smith's views impacted modern theories of economic history? In other words, is the author trying to answer the question, "How has Adam Smith impacted modern theories of economic history?" Not quite... instead, the author wants us to see how Smith's views have led to misinterpretations. The author is basically saying, "Hey, we've been basing our interpretations of history on Smith's views, but what if those views aren't entirely accurate?" Choice (B) doesn't quite cut it.

Quote:
(C) Chronicling the early history of the use of credit in business relations

The passage mentions the use of credit in business relations, but the passage is NOT primarily concerned with describing the early history of credit in business relations. Eliminate (C).

Quote:

As explained for choice (B), most interpretations of the business relations of that time have been significantly influenced by Smith's commonly-accepted views. The author wants us to question Smith's views and thus reexamine the interpretations that were based on those commonly-held ideas. This fits with choice (D).

Quote:
(E) Explaining the decline of cooperation in village communities

The author does criticize the view that buying and selling disrupted cooperation in village communities, but the author does not attempt to explain the decline of that cooperation. Eliminate (E).

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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith... [#permalink]

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05 Dec 2017, 10:51
Time Taken - 6 mins

Got 2/3 correct.
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Re: In the Wealth of Nations (1776), Scottish economist Adam Smith...   [#permalink] 05 Dec 2017, 10:51

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