John Maynard Keynes and Friedrich Hayek, two prominent public figures

A. Hayek’s solution to the economic depression was not guided in the right direction.

Incorrect: Out of Scope. The author states that Hayek’s solution was not politically viable. This does not necessarily mean that it was misguided.

B. Before Wapshott’s 2012 study, Hayek’s contribution to the field of economics was unknown.

Incorrect: Out of Scope. The author states that Wapshott gave “unprecedented” /unmatched importance to Hayek’s work. This does not give us any basis to understand that Hayek’s work was unknown before Wapshott’s analysis.

C. Hayek’s contribution to economics began in the 1970s and has continued into the twenty-first century.

Incorrect: Out of Scope. The passage states Keynes’ contribution dominated Western economic analyses until the 1970s. We do not know when Hayek’s contribution began.

D. Macroeconomics was singlehandedly created by Hayek.

Incorrect: Inconsistent. The author states that Hayek established the distinction between microeconomics and macroeconomics, not that he created macroeconomics.

E. A specific work gave more importance to Hayek’s work than ever before.

Correct. This information is explicitly stated in the passage as the author states that Wapshott’s study gave “unprecedented importance” to Hayek’s work.


A. contrast two solutions to the same issue.

Incorrect: Partial Scope. The author contrasts the two views only in the first paragraph of the passage. The second half of the passage is devoted to highlighting why the solution proposed by Hayek was not appreciated as much as it should have been.

B. establish the superiority of one hypothesis over another.

Incorrect: Out of scope. The author does not say that Hayek’s hypothesis was superior to Keynes’.

C.prove that one theorist's contribution to a particular field was more notable than another's.

Incorrect: Out of Scope. The author does not say that Hayek’s contribution was more noteworthy than Keynes’.

D. outline different approaches to a historical problem.

Incorrect: Out of Context. First of all, the author doesn’t discuss the Great Depression and the proposed solutions to it in general. Secondly, the author does present Keynes’ and Hayek’s differing views, but this is not the main purpose of the author as discussed in the solution to choice A.

E. contrast two different approaches to a historical problem and share the reason for the limited appreciation for one

Correct. This choice matches our understanding of the passage, as detailed in the passage analysis, and our discussion in the pre-thinking analysis.


A. They wanted to speed up the process of reestablishing the economy’s prosperity.

Incorrect: Out of Scope. There is no given information that states or hints that the political organizations felt so.

B. They believed it was futile for the government to get involved in market mechanisms.

Incorrect: Opposite. This was Hayek’s view; not the view of the political parties.

C. They believed they had a responsibility to intervene in the situation.

Incorrect: Inconsistent. This was Keynes’ view as he believed that the governments “should” intervene in the situation. From the information given about the political parties, we just know that these organizations wanted to prove that they could be significant in reestablishing the economy’s prosperity; nothing can be said about whether they felt they had the responsibility to do so.

D. They wanted to prove that they were capable of reinstating the economy’s well-being.

Correct. This choice matches the author’s statement that each political party was “seeking to prove its worth” in helping the economy to recover.

E. They believed that Hayek's solution would undermine their future in politics.

Incorrect: Inconsistent. Wapshott states that Hayek’s view was unpopular because it was not politically viable at the time. We do not know whether the political parties of the time felt threatened about their futures.


A. Hayek’s theory was dominated by Keynes’ because Keynes had a better long-term vision than Hayek did.

Incorrect: Out of Scope. The author does not state or imply anything about the long-term viability of Keynes’ theory.
B. Even though the reaction of the political organization could be anticipated, the underwhelming response received by Hayek in general was not indicative of the potential of his theory.

Correct. This choice is a combination of two opinions expressed by the author. The author states that the rejection of Hayek’s solution by the political organizations was not surprising. Hence, we can understand that their reaction could be anticipated. And we are also told that Hayek’s theory was “underestimated”. This means that the author believes that the merits of the theory weren’t fully appreciated.

C. In addition to being politically viable, Hayek’s ideas were probably ahead of their time.

Incorrect: Out of Scope. The author does not comment on/suggest anything about the relevance of Hayek’s ideas with respect to their being ahead of their time.

D. Had Keynes also argued for limited government intervention, his ideas too would have been vehemently rejected by the political organizations.

Incorrect: Out of Scope. We have no basis to conclude whether Keynes would have received a similar response by the then political organizations. Also, the word “vehemently” makes this choice too extreme.

E. In the light of the real reason that Hayek’s theory did not receive much appreciation, Keynes probably did not contribute as much to economics as he is credited for.

Incorrect: Out of Scope. Wapshott’s analysis, which the author uses to convey his/her point about Hayek’s theory being underestimated at the time of the Depression, just tells us that the real reason that Hayek’s theory was overshadowed by Keynes’ was not that it had limited merits but because it was politically not viable. From this specific analysis, we cannot draw any inference about the merits of Keynes’ theory and certainly not about his overall contribution to economics.