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QOTD #5 Relieving an impoverished country of its debt would seem to al

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QOTD #5 Relieving an impoverished country of its debt would seem to al [#permalink]

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Relieving an impoverished country of its debt would seem to almost unavoidably help the citizens of that nation. Indeed, health care and education spending is now greater than debt service payments in many countries that have been granted partial debt relief by the Heavily Indebted Poor Countries (HIPC) Initiative launched by the International Monetary Fund and the World Bank, and complete debt relief by the supplementary Multilateral Debt Relief Initiative (MDRI). Several factors, however, have kept these programs from becoming truly transformational.


For a nation to qualify for the HIPC, it must have a level of debt that cannot be managed through traditional means. The removal of this enormous burden means that badly needed resources can go to programs that aid needy citizens, just as is intended.
However, the HIPC has strict rules that sharply limit this spending. In some cases, teachers are not hired and HIV/AIDS tests are not administered because the sudden spending might lead to macroeconomic instability. This is a paradox that must be confronted: Poor nations need to spend money desperately but wisely.

A more daunting obstacle is the lack of a private sector in many of the countries that are served by the HIPC. Property rights may be virtually non-existent. Without individuals
and businesses willing and able to invest resources in their own country, progress can be glacial. Outside investors are forced to deal not with business partners as such, but
with governmental agencies ranging from the inept to the murderously corrupt. There is no guarantee that funds meant for a hospital or school will ever find their way to the
intended destination, whether because of corruption or the sheer difficulty of moving goods around in a place that is, as is so often the case in truly poor countries, at war.

Debt relief remains an important tool in reducing the terrible suffering that affects so many people in the underdeveloped world. However, it is not enough to clean the slate
and say, “start anew.” Without the willingness on the part of the governing body to allow its citizens to take part in their own development, and without the right balance of emergency spending and careful investment, unmanageable debt will return, as evidenced by nations that have been borrowing money faster than their debt can be relieved.
Which of the following titles best summarizes the contents of the passage?

(A) Debt Relief as a Tool for Increasing Private Investment in Impoverished Nations
(B) The Difficulties of Implementing Debt Relief in Very Poor Countries
(C) Obstacles to Channeling Aid to Needy Destinations in Very Poor Countries
(D) The Inherent Flaws in Debt Relief Programs
(E) HIPC: Well-Meaning, but Insufficient

Spoiler: :: OA
B


Which of the following was NOT mentioned as a difficulty associated with debt relief?

(A) Long-term needs have to be addressed at the same time as more immediate one.
(B) Nations that need debt relief are often in the midst of violent conflicts.
(C) Debt relief can swiftly be replaced by new debt.
(D) Private investors in very poor countries are often corrupt.
(E) The pace of development in poor nations can be extremely slow.

Spoiler: :: OA
D


According to the passage, a nation receiving assistance from the HIPC _______.
(A) must not be engaged in a war in which it is an aggressor
(B) must have at least a minimal amount of privately held property, including businesses
(C) must not have a level of debt that can be managed through a typical debt relief program
(D) is required to allow ordinary citizens input regarding the use of resources that have been made available through the initiative
(E) would also be eligible for assistance from the MDRI

Spoiler: :: OA
C


Which of the following can be inferred from the passage regarding some of the nations that have received assistance from the HIPC initiative and from the MDRI?

(A) They have histories of macroeconomic instability.
(B) Debt service payments once exceeded the amount of money that was spent on schools and hospitals.
(C) Property rights had to be established prior to receiving the assistance.
(D) Civil war sharply limited the amount of debt relief provided.
(E) The citizens were unwilling to take part in their nations’ development.

Spoiler: :: OA
B


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Re: QOTD #5 Relieving an impoverished country of its debt would seem to al [#permalink]

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Which of the following titles best summarizes the contents of the passage?

(A) Debt Relief as a Tool for Increasing Private Investment in Impoverished Nations - too narrow
(B) The Difficulties of Implementing Debt Relief in Very Poor Countries - perfect
(C) Obstacles to Channeling Aid to Needy Destinations in Very Poor Countries - not correct, there is nothing difficult about channeling the aid.
(D) The Inherent Flaws in Debt Relief Programs - 'Inherent' is not the right word choice here. There are flaws but they are not inherent.
(E) HIPC: Well-Meaning, but Insufficient - too narrow

Which of the following was NOT mentioned as a difficulty associated with debt relief?

(A) Long-term needs have to be addressed at the same time as more immediate one. - stated in passage
(B) Nations that need debt relief are often in the midst of violent conflicts. - mentioned at the end of paragraph 3
(C) Debt relief can swiftly be replaced by new debt. - stated in passage
(D) Private investors in very poor countries are often corrupt. - correct, the passage talks about the government not investors.
(E) The pace of development in poor nations can be extremely slow. - stated in passage


According to the passage, a nation receiving assistance from the HIPC _______.
(A) must not be engaged in a war in which it is an aggressor - unknown
(B) must have at least a minimal amount of privately held property, including businesses - tricky but not talked about in the passage
(C) must not have a level of debt that can be managed through a typical debt relief program - true this is stated directly in the passage
(D) is required to allow ordinary citizens input regarding the use of resources that have been made available through the initiative - unknown
(E) would also be eligible for assistance from the MDRI - unknown

Which of the following can be inferred from the passage regarding some of the nations that have received assistance from the HIPC initiative and from the MDRI?

(A) They have histories of macroeconomic instability. - tricky but can not be inferred
(B) Debt service payments once exceeded the amount of money that was spent on schools and hospitals. - yes this can be inferred.
(C) Property rights had to be established prior to receiving the assistance. - unknown, the passage states 'property rights may be non existant' the word may be is very important here.
(D) Civil war sharply limited the amount of debt relief provided. - unknown
(E) The citizens were unwilling to take part in their nations’ development. - unknown
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Re: QOTD #5 Relieving an impoverished country of its debt would seem to al [#permalink]

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Which of the following titles best summarizes the contents of the passage?

(A) Debt Relief as a Tool for Increasing Private Investment in Impoverished Nations - Not mentioned in the passage
(B) The Difficulties of Implementing Debt Relief in Very Poor Countries. - Apt Title
(C) Obstacles to Channeling Aid to Needy Destinations in Very Poor Countries Not mentioned in the passage
(D) The Inherent Flaws in Debt Relief Programs. Passage doest enumerate flaws of programs
(E) HIPC: Well-Meaning, but Insufficient. Incorrect Inference

Which of the following was NOT mentioned as a difficulty associated with debt relief?

(A) Long-term needs have to be addressed at the same time as more immediate one.
(B) Nations that need debt relief are often in the midst of violent conflicts.
(C) Debt relief can swiftly be replaced by new debt.
(D) Private investors in very poor countries are often corrupt. - Incorrect Interpretation - In para 3 "Outside investors are forced to deal not with business partners as such, but with governmental agencies ranging from the inept to the murderously corrupt."
(E) The pace of development in poor nations can be extremely slow.

According to the passage, a nation receiving assistance from the HIPC _______.
(A) must not be engaged in a war in which it is an aggressor
(B) must have at least a minimal amount of privately held property, including businesses - Para 2 "For a nation to qualify for the HIPC, it must have a level of debt that cannot be managed through traditional means."
(C) must not have a level of debt that can be managed through a typical debt relief program
(D) is required to allow ordinary citizens input regarding the use of resources that have been made available through the initiative
(E) would also be eligible for assistance from the MDRI

Which of the following can be inferred from the passage regarding some of the nations that have received assistance from the HIPC initiative and from the MDRI?

(A) They have histories of macroeconomic instability.
(B) Debt service payments once exceeded the amount of money that was spent on schools and hospitals. Para 1 "Indeed, health care and education spending is now greater than debt service payments in many countries that have been granted partial debt relief by"
(C) Property rights had to be established prior to receiving the assistance.
(D) Civil war sharply limited the amount of debt relief provided.
(E) The citizens were unwilling to take part in their nations’ development.
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Re: QOTD #5 Relieving an impoverished country of its debt would seem to al [#permalink]

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Re: QOTD #5 Relieving an impoverished country of its debt would seem to al [#permalink]

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Which of the following titles best summarizes the contents of the passage?

(A) Debt Relief as a Tool for Increasing Private Investment in Impoverished Nations - Too specific
(B) The Difficulties of Implementing Debt Relief in Very Poor Countries - summarize the passage to great extend
(C) Obstacles to Channeling Aid to Needy Destinations in Very Poor Countries - Difficulty is not with channeling aid but in implementing the debt relief
(D) The Inherent Flaws in Debt Relief Programs - 'Inherent' too hard word
(E) HIPC: Well-Meaning, but Insufficient - too specific

Which of the following was NOT mentioned as a difficulty associated with debt relief?

(A) Long-term needs have to be addressed at the same time as more immediate one. - Mentioned in 3rd
(B) Nations that need debt relief are often in the midst of violent conflicts. - mentioned
(C) Debt relief can swiftly be replaced by new debt. - mentioned
(D) Private investors in very poor countries are often corrupt. - It says that investors have to work with the corrupt governmental agencies and not the other ways..
(E) The pace of development in poor nations can be extremely slow. - mentioned


According to the passage, a nation receiving assistance from the HIPC _______.
(A) must not be engaged in a war in which it is an aggressor - not supported in passage
(B) must have at least a minimal amount of privately held property, including businesses - not supported in passage
(C) must not have a level of debt that can be managed through a typical debt relief program - Yes true
(D) is required to allow ordinary citizens input regarding the use of resources that have been made available through the initiative- not mentioned
(E) would also be eligible for assistance from the MDRI - not mentioned

Which of the following can be inferred from the passage regarding some of the nations that have received assistance from the HIPC initiative and from the MDRI?

(A) They have histories of macroeconomic instability. - cant be inferred
(B) Debt service payments once exceeded the amount of money that was spent on schools and hospitals. - yes this can be inferred.
(C) Property rights had to be established prior to receiving the assistance. -
(D) Civil war sharply limited the amount of debt relief provided. - no direct inference
(E) The citizens were unwilling to take part in their nations’ development. - not mentioned
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Re: QOTD #5 Relieving an impoverished country of its debt would seem to al [#permalink]

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Under 10 mins, all correct. Guys please share your timings along with your post.
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Re: QOTD #5 Relieving an impoverished country of its debt would seem to al [#permalink]

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05min 30 sec. All correct.
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Re: QOTD #5 Relieving an impoverished country of its debt would seem to al [#permalink]

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New post 14 Feb 2017, 12:11
I felt this passage to be very difficult.... But don't know why.

Can anybody please counter my below points to let me know where I my analysis went wrong -

Which of the following titles best summarizes the contents of the passage?

(A) Debt Relief as a Tool for Increasing Private Investment in Impoverished Nations - Not mentioned in the passage
(B) The Difficulties of Implementing Debt Relief in Very Poor Countries. - The passage does not say anything about difficulties in implementing debt relief program.. If says that these programs though look well, but they will not bring the intended result. The passage gave examples about why these programs will not bring the intended results. exp - for govt corruption, debt level of the country etc.
(C) Obstacles to Channeling Aid to Needy Destinations in Very Poor Countries Not mentioned in the passage
(D) The Inherent Flaws in Debt Relief Programs. Passage doest enumerate flaws of programs
(E) HIPC: Well-Meaning, but Insufficient. Correct one.... Because this choice says the main program HIPC looks well but truly insufficient to bring the intended result.

Which of the following can be inferred from the passage regarding some of the nations that have received assistance from the HIPC initiative and from the MDRI?

(A) They have histories of macroeconomic instability.
(B) Debt service payments once exceeded the amount of money that was spent on schools and hospitals. Para 1 "Indeed, health care and education spending is now greater than debt service payments in many countries that have been granted partial debt relief by" --> how come this be inferred? today school and hospital cost is greater, but it does not mean that in past it was opposite.. They might be comparable...
(C) Property rights had to be established prior to receiving the assistance.
(D) Civil war sharply limited the amount of debt relief provided.
(E) The citizens were unwilling to take part in their nations’ development. --> I guess this is the correct ans... Because it is clearly mentioned in this passage that in order to have success, these programs might need citizens' proactive response, hinting that citizens were unwilling to take part previously.
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Re: QOTD #5 Relieving an impoverished country of its debt would seem to al [#permalink]

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New post 11 Mar 2018, 00:36
9:30.. 3/4. Got the first one incorrect :( . Unfortunately selected 'E'.
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Re: QOTD #5 Relieving an impoverished country of its debt would seem to al [#permalink]

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New post 11 Mar 2018, 06:37
Which of the following can be inferred from the passage regarding some of the nations that have received assistance from the HIPC initiative and from the MDRI?

(A) They have histories of macroeconomic instability.
(B) Debt service payments once exceeded the amount of money that was spent on schools and hospitals.
(C) Property rights had to be established prior to receiving the assistance.
(D) Civil war sharply limited the amount of debt relief provided.
(E) The citizens were unwilling to take part in their nations’ development.

Imo D

But the answer is B.
Can anyone please explain why D is wrong.
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Re: QOTD #5 Relieving an impoverished country of its debt would seem to al [#permalink]

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arvind910619 wrote:
Which of the following can be inferred from the passage regarding some of the nations that have received assistance from the HIPC initiative and from the MDRI?

(A) They have histories of macroeconomic instability.
(B) Debt service payments once exceeded the amount of money that was spent on schools and hospitals.
(C) Property rights had to be established prior to receiving the assistance.
(D) Civil war sharply limited the amount of debt relief provided.
(E) The citizens were unwilling to take part in their nations’ development.

Imo D

But the answer is B.
Can anyone please explain why D is wrong.


"There is no guarantee that funds meant for a hospital or school will ever find their way to the
intended destination, whether because of corruption or the sheer difficulty of moving goods around in a place that is, as is so often the case in truly poor countries, at war." --> This implies the distribution of aid was hampered not the supply. [This was my logic of eliminating D].

Hope this helps. :)
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Re: QOTD #5 Relieving an impoverished country of its debt would seem to al   [#permalink] 11 Mar 2018, 08:08
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