One recent example of industrial hyper growth has taken place in the r

Question

One recent example of industrial hyper growth has taken place in the recycling industry, led by the rapid expansion of the recycled paper market. Though many laws were enacted in the late 1980s to encourage (and in some cases require) the collection of waste paper for recycling, there were not, at that time, companies with sufficient capacity to recycle it all. Consequently the collected paper accumulated in storage, usually at the expense of the recycling companies, thereby adding to their overhead and squeezing their already thin profit margins.

Today a different situation exists. Fifty-seven new paper mills have been built since 1991, and of these, at least twenty-nine use recycled fiber. This surge in capacity has resulted in a concurrent rise in profits. The price per Ton of waste paper has quadrupled in the past year, as have the prices of corrugated cardboard and used newsprint. Trash haulers have benefited from these conditions by combining their trash hauling and recycling operations.

Recycling centers are connected both to the clients to whom they sell end products and to those from whom they collect refuse; thus, the company gets paid twice for the same trash, once for hauling the waste and once for selling the usable material. Industry profits have increased more than tenfold during this period. As the industry has become more competitive, some haulers have chosen to rebate a portion of this money to their clients in the hopes of ensuring their loyalty.   1 
1. According to the passage, which of the following is a reason for the increase in profits in the trash hauling business?

(A) Haulers' ability to sell both services and products.
(B) Money offered by haulers to preferred customers.
(C) Foresight exhibited by the leaders of the industry.
(D) Haulers' willingness to adapt technology to a changing industry.
(E) Passage of stricter environmental legislation.

2 
2. It can be inferred from the passage that the price of waste paper
(A) will increase steadily over the next few years
(B) will increase as more companies get involved in the industry
(C) is closely related to the availability of trash haulers
(D) is not as important to trash haulers as the price they charge for hauling waste
(E) is sometimes set by the weight of the product

3 
3. The author of the passage would most likely agree with which of the following?
A. Competition between trash haulers and recyclers will prevent the recycled paper industry from reaching its full economic potential.
B. Pressure from anti-environmental groups has increased pressure on the government to oppose recycled paper initiatives.
C. The recycled paper industry may continue to grow at its present rate as long as the industry remains profitable.
D. The profit-seeking of recyclers have overshadowed environmental concerns in the recycled paper industry.
E. Government negligence prevented the recycled paper industry from becoming successful until the early 1990’s.

4 
4. According to the passage, all of the following are results of the increase in the number of new mills using recycled finer except
A. The price of waste paper has risen dramatically.
B. Trash haulers are earning increased revenues.
C. Profits at recycling centers have increased more than tenfold.
D. The price of corrugated cardboard has risen.
E. Trash haulers have been forced to compete with recyclers.

patto · Answer

1-> A --> "Trash haulers have benefited from these conditions by combining their trash hauling and recycling operations."
"Recycling centers are connected both to the clients to whom they sell end products and to those from whom they collect refuse; thus, the company gets paid twice for the same trash, once for hauling the waste and once for selling the usable materia."
2-> E --> "The price per Ton of waste paper has quadrupled in the past year, as have the prices of corrugated cardboard and used newsprint." As you can easily see, the price is set by the weight.
3 -->C--> "Recycling centers are connected both to the clients to whom they sell end products and to those from whom they collect refuse; thus, the company gets paid twice for the same trash, once for hauling the waste and once for selling the usable material. Industry profits have increased more than tenfold during this period." From this sentence, we can infer that the author will agree with C.
4--> From paragraph 2 we can conclude that the answer is E. That trash haulers had to compete with recyclers is not mentioned.

JS1290 · Answer

mikemcgarry   GMATNinja   GMATNinja Two  sayantanc2k

Could one of you guys please explain how option E is correct for Q2? We are only given, "The price per Ton of waste paper has quadrupled in the past year, as have the prices of corrugated cardboard and used newsprint". From this statement, how can one infer that the price is, "sometimes set by the weight of the product"? Please help!

GMATNinjaTwo · Answer

A "Ton" is a unit of weight. We are told that "the price per Ton of waste paper has quadrupled in the past year." Thus, we know that the price per unit weight was known (as opposed to, say, price per unit volume). So, we can infer that the price was sometimes set by unit weight.

In other words, we know that price of waste paper has been measured by weight.

TaN1213 · Answer

Hello  Sasindran

Would you please correct the OA you've posted for Q1 and Q2? They seem to have reversed. Q1 should have been A and Q2 should have been E, while it is the other way round now.

broall · Answer

Could you provide the source of this question so I could verify it? I don't know which paper test code this question is in.

TaN1213 · Answer

Reading the above post of GmatNinjaTwo, it is clear that OA of Q2 is E whereas Q1's A option is not only the most voted option but also the logically correct.
But, ironically I don't see any post noting this difference in the OAs. This left the room for me to think that the OAs might have got reversed by mistake.

Would you please check ?
Thank you.

Harsh777 · Answer

Is there OE for this?
Q2- The passage mentions Hypergrowth, Increased competition, but no where can we infer the future of these companies. So E seems reasonable choice, right? Similarly, for Q3 and Q4, what's the OE?

Q1 speaks about haulers and not recyclers. So we can say it's the regulation which helped. But what about the other 3 questions?

Posted from my mobile device

bM22 · Answer

Hi  Harsh777 ,

The OA's for Question 1 and 2 were reversed. All the OA's are now correct. I don't have the OE, but for Question 2 please refer this answer by expert:

https://gmatclub.com/forum/one-recent-example-of-industrial-hyper-growth-has-taken-place-in-the-r-257486.html#p2025904

Let me know if you still have doubts.
Thanks.

Sajjad1994 · Answer

Explanation

1. According to the passage, which of the following is a reason for the increase in profits in the trash hauling business?

Difficulty Level:   600

Explanation

Look for the cause of increased profits for trash haulers. This is discussed in  paragraph 3 .

(A)  paraphrases the idea that the companies haul the trash (services) and sell the recycled paper (products).

(B)  is a trap because preferred customers is a recognizable phrase from a different part of the passage.

(C), (D),  and  (E)  are all out of scope.

Answer: A

Sajjad1994 · Answer

Explanation

2. It can be inferred from the passage that the price of waste paper

Difficulty Level:   700+

Explanation

Look for the price of waste paper. It’s discussed in  paragraph 2 . In step 3, students will answer that prices have increased a lot.

(A)  and  (B)  come close to that, but they make predictions rather than describing the past.

(C)  and  (D)  are out of scope.

(E)  is true (price per ton), even though it may seem trivial.

Answer: E

Sajjad1994 · Answer

Explanation

3. The author of the passage would most likely agree with which of the following?

Difficulty Level:   600

Explanation

(A)  says the opposite of the passage: they cooperate more than they compete.

(B), (D) , and  (E)  are all out of scope.

(C)  isn’t great, but it’s probably true (you gotta love may) and consistent with the author’s description.

Answer: C

Sajjad1994 · Answer

Explanation

4. According to the passage, all of the following are results of the increase in the number of new mills using recycled finer except

Difficulty Level:   600

Explanation

With EXCEPT questions, find each of the wrong answers in the passage before you cross them off. The remaining, correct answer may either contradict the passage or just be out of scope.

(A)  is supported by  Paragraph 2 .

(B)  is supported by lines  Paragraph 3 .

(C)  is supported by lines  Paragraph 3 .

(D)  is supported by lines  Paragraph 2 .

(E)  contradicts the idea of cooperation between trash haulers and recyclers.

Answer: E

One recent example of industrial hyper growth has taken place in the r

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One recent example of industrial hyper growth has taken place in the r

Prep Toolkit

615 to 715 in 15 Days (Ria's Strategies)

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