The informal sector of the economy involves activities that, in both d

Q1). (D)
The primary purpose of this passage is to
○○ compare the economies of developed and underdeveloped countries.
○○ suggest that economists should develop a new framework for studying the global economy.
○○ criticize the notion that the informal economy is primarily a Third World phenomenon.
○○ dispute a widely held view of the relationship between the formal and informal sectors of the world economy.
○○ argue that workers in the informal economy are almost as well paid as those in the formal economy.
Step 2: Analyze the Question Stem
The phrase “primary purpose” signals that this is a Global question. We need the author’s reason for writing the passage.
Step 3: Research the Relevant Text
For this question, we’ll simply consult our notes on topic, scope, and purpose. We shouldn’t have to go back to the passage itself.
Step 4: Make a Prediction
We noted that the author’s purpose in writing the passage is to demonstrate that the economists are wrong in thinking the informal sector of the economy to be “insignificant” compared to the formal sector.
Step 5: Evaluate the Answer Choices
(D) matches our prediction. The “widely held view” is that of the economists. (A) is outside the scope of the passage, which focuses on the economists’ assumptions about the informal sector
of the economy. (B) is again outside the scope. The author makes no recommendation as to what the economists “should” do. (C) is a classic faulty use of detail. The idea that the informal sector is a Third World phenomenon is certainly mentioned and criticized in the passage (specifically, in paragraph 3), but this isn’t the purpose of the entire passage. (E) is another faulty use of detail. The pay rates of informal- and formal-sector workers are mentioned in the third paragraph, but again, this doesn’t constitute the purpose of the entire passage. Choice (D) is correct.

Q2). (B)
From the passage, which of the following can be inferred about employment opportunities in the informal economy?
○○ Workers employed in the informal economy generally receive much lower wages than do workers in the formal economy.
○○ Some workers have purposely chosen to work in the informal economy rather than in the formal economy.
○○ The number of workers employed in the informal economy has remained stable over the last few centuries.
○○ Employment opportunities in the informal economy will decline as agriculture is displaced by industry.
○○ The informal economy has created no employment for workers who would otherwise be unemployable.
Step 2: Analyze the Question Stem
The word “inferred” signals an Inference question. This question stem provides us with a context clue: “employment opportunities in the informal economy.”
Step 3: Research the Relevant Text
Unless a question specifically mentions a different point of view, it is asking for the author’s perspective.
We can safely confine our research to the first and third paragraphs and leave out the second, which describes the economists’ assumptions. In the first paragraph, we learn that informal
sector occupations are typically service jobs such as construction, hotel, or restaurant jobs. In the third paragraph, we learn that informal sector jobs are not jobs “of last resort,” because they don’t
necessarily pay a great deal less than formal sector jobs and because some workers actually move “voluntarily” from the formal to the informal sector.
Step 4: Make a Prediction
While it is difficult to make a precise prediction for this question, the correct answer will follow from our research. We’ll check the answer choices against it one at a time.
Step 5: Evaluate the Answer Choices
(A) states the opposite of the wage information we found in the third paragraph. (B) paraphrases the last couple of lines of the passage: Data support the idea that some workers do voluntarily move from formal sector employment to informal sector employment. This is the correct answer. (C) is too extreme. We learn in the third paragraph that “informal sector employment rates in many
countries have remained constant in the postwar era,” but we have no support for the idea that such employment has remained stable for “centuries.” (C) also confuses employment rates (which
are percentages) with the number employed. (D) restates one of the economists’ assumptions. It is the economists, not the author, who believe that the informal sector will disappear with increasing industrialization. (E) is extreme. While the author debunks the economists’ assumption that the informal sector is “limited in function to being an employment alternative of last resort,” she never
goes so far as to say that not a single job for an otherwise unemployable person has been created in the informal sector. Choice (B) is correct.

Q3). (E)
The author states which of the following about activities in the informal economy?
○○ They are an insignificant aspect of the global economy.
○○ They provide income for workers who are unemployable in the formal economy.
○○ They are a consequence of capitalist penetration of less developed economies.
○○ They thrive mainly in underdeveloped countries in Asia, Africa, and Latin America.
○○ They consist of such unregulated practices as off-the-books hiring and cash payments.
Step 2: Analyze the Question Stem
This Detail question asks us for something the author “states” explicitly. All we need to do is go back to the passage and look up the “activities in the informal economy.”
Step 3: Research the Relevant Text
The “activities” that take place in the informal economy are mentioned at the beginning of the first paragraph. We learn that they are typically “off-the-books” and that they include hiring and cash
payments in the construction, hotel, and restaurant industries.
Step 4: Make a Prediction
We’ll look for an answer choice that mentions any of the details we gleaned from our research.
Remember that for a Detail question, the correct answer has to come from the passage nearly verbatim.
Step 5: Evaluate the Answer Choices
(E) restates what we read in the first paragraph and is the correct answer. (A) is incorrect because it is the economists, not the author, who believe that informal sector activities are “insignificant.”
(B) is incorrect because, again, it states one of the economists’ assumptions, not the author’s opinion.
Similarly, (C) and (D) are incorrect because they present the economists’ beliefs, not the author’s.
Choice (E) is correct.

Q1). (D)
The primary purpose of this passage is to
○○ compare the economies of developed and underdeveloped countries.
○○ suggest that economists should develop a new framework for studying the global economy.
○○ criticize the notion that the informal economy is primarily a Third World phenomenon.
○○ dispute a widely held view of the relationship between the formal and informal sectors of the world economy.
○○ argue that workers in the informal economy are almost as well paid as those in the formal economy.
Step 2: Analyze the Question Stem
The phrase “primary purpose” signals that this is a Global question. We need the author’s reason for writing the passage.
Step 3: Research the Relevant Text
For this question, we’ll simply consult our notes on topic, scope, and purpose. We shouldn’t have to go back to the passage itself.
Step 4: Make a Prediction
We noted that the author’s purpose in writing the passage is to demonstrate that the economists are wrong in thinking the informal sector of the economy to be “insignificant” compared to the formal sector.
Step 5: Evaluate the Answer Choices
(D) matches our prediction. The “widely held view” is that of the economists. (A) is outside the scope of the passage, which focuses on the economists’ assumptions about the informal sector
of the economy. (B) is again outside the scope. The author makes no recommendation as to what the economists “should” do. (C) is a classic faulty use of detail. The idea that the informal sector is a Third World phenomenon is certainly mentioned and criticized in the passage (specifically, in paragraph 3), but this isn’t the purpose of the entire passage. (E) is another faulty use of detail. The pay rates of informal- and formal-sector workers are mentioned in the third paragraph, but again, this doesn’t constitute the purpose of the entire passage. Choice (D) is correct.

Q2). (B)
From the passage, which of the following can be inferred about employment opportunities in the informal economy?
○○ Workers employed in the informal economy generally receive much lower wages than do workers in the formal economy.
○○ Some workers have purposely chosen to work in the informal economy rather than in the formal economy.
○○ The number of workers employed in the informal economy has remained stable over the last few centuries.
○○ Employment opportunities in the informal economy will decline as agriculture is displaced by industry.
○○ The informal economy has created no employment for workers who would otherwise be unemployable.
Step 2: Analyze the Question Stem
The word “inferred” signals an Inference question. This question stem provides us with a context clue: “employment opportunities in the informal economy.”
Step 3: Research the Relevant Text
Unless a question specifically mentions a different point of view, it is asking for the author’s perspective.
We can safely confine our research to the first and third paragraphs and leave out the second, which describes the economists’ assumptions. In the first paragraph, we learn that informal
sector occupations are typically service jobs such as construction, hotel, or restaurant jobs. In the third paragraph, we learn that informal sector jobs are not jobs “of last resort,” because they don’t
necessarily pay a great deal less than formal sector jobs and because some workers actually move “voluntarily” from the formal to the informal sector.
Step 4: Make a Prediction
While it is difficult to make a precise prediction for this question, the correct answer will follow from our research. We’ll check the answer choices against it one at a time.
Step 5: Evaluate the Answer Choices
(A) states the opposite of the wage information we found in the third paragraph. (B) paraphrases the last couple of lines of the passage: Data support the idea that some workers do voluntarily move from formal sector employment to informal sector employment. This is the correct answer. (C) is too extreme. We learn in the third paragraph that “informal sector employment rates in many
countries have remained constant in the postwar era,” but we have no support for the idea that such employment has remained stable for “centuries.” (C) also confuses employment rates (which
are percentages) with the number employed. (D) restates one of the economists’ assumptions. It is the economists, not the author, who believe that the informal sector will disappear with increasing industrialization. (E) is extreme. While the author debunks the economists’ assumption that the informal sector is “limited in function to being an employment alternative of last resort,” she never
goes so far as to say that not a single job for an otherwise unemployable person has been created in the informal sector. Choice (B) is correct.

Q3). (E)
The author states which of the following about activities in the informal economy?
○○ They are an insignificant aspect of the global economy.
○○ They provide income for workers who are unemployable in the formal economy.
○○ They are a consequence of capitalist penetration of less developed economies.
○○ They thrive mainly in underdeveloped countries in Asia, Africa, and Latin America.
○○ They consist of such unregulated practices as off-the-books hiring and cash payments.
Step 2: Analyze the Question Stem
This Detail question asks us for something the author “states” explicitly. All we need to do is go back to the passage and look up the “activities in the informal economy.”
Step 3: Research the Relevant Text
The “activities” that take place in the informal economy are mentioned at the beginning of the first paragraph. We learn that they are typically “off-the-books” and that they include hiring and cash
payments in the construction, hotel, and restaurant industries.
Step 4: Make a Prediction
We’ll look for an answer choice that mentions any of the details we gleaned from our research.
Remember that for a Detail question, the correct answer has to come from the passage nearly verbatim.
Step 5: Evaluate the Answer Choices
(E) restates what we read in the first paragraph and is the correct answer. (A) is incorrect because it is the economists, not the author, who believe that informal sector activities are “insignificant.”
(B) is incorrect because, again, it states one of the economists’ assumptions, not the author’s opinion.
Similarly, (C) and (D) are incorrect because they present the economists’ beliefs, not the author’s.
Choice (E) is correct.