Since the late 1970’s, in the face of a severe loss of market share in

**The passage was free-flowing and easy to read. For a lot of questions you can easily go down to the last two choices but getting to the final answer might be slightly tricky. With this in mind, I have tried to tailor the answers which addresses this problem.

Answers are in bold.

1. The author of the passage is primarily concerned with
(A) summarizing a thesis
(B) recommending a different approach
(C) comparing points of view
(D) making a series of predictions
(E) describing a number of paradoxes

Explanation of question 1
Let us look into choices B and E. Both are potential answers, however E suggests that the passage describes a number of paradoxes. It might be tempting as the word is used, however on close inspection we find that it is not really what the author intends. The author says how can manufacturing firms improve and stay competitive. B is the clear winner.
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2. It can be inferred from the passage that the manufacturers mentioned in line 2 expected that the measures they implemented would
(A) encourage innovation
(B) keep labor output constant
(C) increase their competitive advantage
(D) permit business upturns to be more easily predicted
(E) cause managers to focus on a wider set of objectives

Explanation of question 2
I'll not spend too much time on this answer, it is pretty straightforward and is stated here "—and therefore enhance their international competitiveness—"
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3. The primary function of the first paragraph of the passage is to
(A) outline in brief the author’s argument
(B) anticipate challenges to the prescriptions that follow
(C) clarify some disputed definitions of economic terms
(D) summarize a number of long-accepted explanations
(E) present a historical context for the author’s observations

Explanation of question 3
We can see B and E can only be possible choices. Let us zoom into B and see why it is NOT the correct choice. B says the first para anticipates challenges to the prescriptions that follow. Now, does the author prescribe things in the following paragraphs? - absolutely, but does the author anticipate challenges? Not really. The author does say there is an inherent paradox, and therefore suggests a few ways out.
Now let as look at E, this is much clearer choice where he is giving historical references (for e.g. in 1978 to 1982 etc) about manufacturers losing their competitive advantage if they did too much cost-cutting. E is a clear winner.
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4. The author refers to Abernathy’s study (Highlighted Text) most probably in order to
(A) qualify an observation about one rule governing manufacturing
(B) address possible objections to a recommendation about improving manufacturing competitiveness
(C) support an earlier assertion about one method of increasing productivity
(D) suggest the centrality in the United States economy of a particular manufacturing industry
(E) given an example of research that has questioned the wisdom of revising a manufacturing strategy

Explanation of question 4
Abernathy's study showed that too much cost-cutting can be a hindrance to develop new products. Therefore, cost cutting is the one method for increasing productivity. Now what was the assertion about cost-cutting? Possibly that it hinders the new developments - therefore being detrimental to manufacturer's growth. C is a solid choice and will go with this.
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5. The author’s attitude toward the culture in most factories is best described as
(A) cautious
(B) critical
(C) disinterested
(D) respectful
(E) adulatory

Explanation of question 5
Down to A and B very easily, but which would this be out of the two? I would not say he is cautious, the author is pretty outspoken and is not afraid to share his views. Therefore, I would lean towards "critical".
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6. In the passage, the author includes all of the following EXCEPT
(A) personal observation
(B) a business principle
(C) a definition of productivity
(D) an example of a successful company
(E) an illustration of a process technology

Explanation of question 6
Again down to D and E.
D is tricky, because when we talk about examples, it is easy to assume that an example must have a mane, for example Amazon does not do cost-cutting etc. But this is not always true, as the author does say that successful companies do it a certain way without actually naming one.
E has the word "illustration" in it, and we really have no basis to think there is some sort of illustration given by the author in this passage.
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7. The author suggests that implementing conventional cost-cutting as a way of increasing manufacturing competitiveness is a strategy that is
(A) flawed and ruinous
(B) shortsighted and difficult to sustain
(C) popular and easily accomplished
(D) useful but inadequate
(E) misunderstood but promising

Explanation of question 7
Again down to A an D.
For me personally, I don't think the tone of the author is negative to the core, and by that I mean the author does not say all manufacturers are DOOMED. he merely addresses the fact that conventional cost cutting techniques are flawed. Therefore, I would avoid choice A which has two very heavy negative words. Sure it is flawed, but ruinous?? that is pushing it isn't it?
D is much more balanced choice, where it acknowledges the fact that it is useful in some cases, but a lot more has to be done to make it adequate enough for manufacturers to follow.