Most large corporations in the United States were once run by individu

p1: to state/ describe the impact on productivity / long-term growth of companies as a result of investor base changes from individual capitalist to institutions and short-term traders
p2: to argue that since the return of capitalists is unlikely a number of measures need to be implemented to change the way existing players invest

Q1
The author is primarily concerned with arguing in favour of implementing specific measures that prevent loss and promote growth of companies.
A is incorrect as the author isn't concerned with comparing
B is correct because in P1 a problem is described and in P2 a solution is proposed
C is incorrect because the author merely mentions an older method and criticises current methods
D is incorrect as no data is presented.
E is incorrect because the author only presents his analysis, no one else

Q2
P1 describes majority shareholders.
Individual capitalists once held, what is inferred as, majority stock such that they dictated company policy to promote long-term gain.
Now, institutions hold the majority of stock, collectively, but individually they are prohibited from owning majority stock and thus influencing company decision making. So it may be inferred that in a classical sense, A Majority shareholder does not exist.

Based on the author's recommendations we know that shareholders NOW are prevented from holding a dominant shareholder position and aren't encouraged to participate in operations.

A is incorrect because we are told that the majori
B this would seem counter to what is bein
C is correct as it is stated in the second sentence of the first para. that "because putting such large amounts of stock on the market would only depress its value..."
D is incorrect because we don't know this. Essentially we are told that majority shareholders chase productivity because THEY CANT sell for a quick profit, but we don't know whether they are more interested in profits.
E no - this is a suggestion made by the author not a requirement

Q3
The requirement in question is that ">=25% equity holders should be forced to give the public one day's notice of the intent to sell the shares". Based on what we know, any significant shareholding sold at once could depreciate the value of the shares or lead others into thinking the motives behind selling are based on expectations of anticipated future losses.

A - no the requirement is to prevent this not encourage it. Incorrect.
B - no, the requirement is related to value, not influence.
C - Yes. This is the only rational thought here that substantiates the motive .
D - No, again the requirement in question is to prevent value fluctuations
E - no. Worst answer of the lot.


Q4
What we know of the old-style capitalist is largely contained in P1:
- they couldn't sell for short-term profit
- they dominated the board and dictated company policy
- they focused on longer-term gains via productivity improvements

A is incorrect. The author is actually encouraging a move towards the management techniques. We also don't know whether these capitalists exist anymore, so "they now" is wrong.
B is the only thing that's supported.. Its inferred that they NEVER engaged in short-term trading, but for someone to "typify" "old-capitalist" style that someone could plausibly "rarely" or (seldom) short-term trade.
C we don't know this. We only know that they influenced company policy.
D it is inferred that the capitalists don't exist in "since the return..", so it would be hard to substantiate whether they play ANY role.
E is completely false - for the facts given.

Q5
A is incorrect. No assertion or statement is made.
B it is stated that these individuals "could not sell out for a quick profit and instead...concentrated on improving the long-term productivity of their companies". Thus it MUST be TRUE that LT Productivity improvements led to increased profits.
C There could be 1 majority capitalist, 100x smaller investors, so this is hardly assumed.
D this isn't assumed, the author merely states that doing so would depreciate the value significantly he didn't say there was NEVER short-term trading
E this isn't assumed. We are merely told that individuals held majority stock. What if a corporation held 1% of the stock?

Q6
They role difference is that Individual institutions do not actively participate in company decision making and their investment strategies are more short-term and speculative.
A is not suggested. They could invest in only 1 company.
B is correct
C is not supported. No mention of brokers.
D is completely false. We are told the opposite in fact.
E how can this substantiate the difference between capitalists and institutions? It relates to motives of institutions.

Q7
Primary function of the second para is explained in the map above.
A - this is false. See map above
B - does not align. See map above
C - no. See map above
D - no. Not to evaluate but to suggest them.
E - Yes. To recommend actions.

Q8
A. Although in p1 it states that "these institutions are prohibited by antitrust laws from owning a majority of a company's stock....". We only know that, "with a few exceptions, the majority of stock is held by institutions", so we cannot assume that antitrust laws apply to individuals as they do institutions.
B. No. This is a recommendation made, not fact.
C. No. We cannot deduce this based on the info given. We are only told of the role capitalists undertook in such decision making.
D. Although a "large amount" is confusing - what is "amount"? we are only told of proportions throughout - this answer is correct as generally we are told of preventions that inhibit short term profit and we are also told of the effects that stem from majority shareholder dumping.
E. This is really muddled statement as it confuses a lot of things said.