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# The United States hospital industry is an unusual market in that

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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
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Time taken 5:30 mins.

1.Which of the following best describes the overall content of the second paragraph of the passage?
A. It describes "views" concerning a particular aspect of one of the types of hospitals discussed earlier.
"The same literature offers similarly conflicting views of the efficiency of nonprofit hospitals from a social welfare perspective"

2. According to the passage, Newhouse's view of the social welfare efficiency of nonprofit hospitals differs from Weisbrod's view in that Newhouse
E. believes that the level of care provided by nonprofit hospitals is inappropriate, given the community's requirements
"onprofit hospital managers unnecessarily expand the quality and quantity of hospital care beyond the actual needs of the community"

3. The passage suggests which of the following about the managers mentioned in the highlighted text?
D. Their decisions regarding services provided by their hospitals may not reflect hospital owners' priorities.
"generally work independently of hospital owners and thus may not always make maximum financial efficiency their highest priority."

Originally posted by JarvisR on 13 Aug 2014, 12:25.
Last edited by PiyushK on 13 Aug 2014, 21:33, edited 1 time in total.
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Re: The United States hospital industry is an unusual market in that [#permalink]
1. The passage is primarily concerned with
(A) discussing the advantages of increased efficiency in a particular type of hospital
not okie, no mention to advantages of increased efficiency ....
(B) assessing obstacles to efficiency in a particular type of hospital
obstables .... not okie
(C) describing conflicting assessments in the theoretical literature concerning particular types of hospitals
okie, 2nd paragraph
(D) Challenging evidence used to support an argument advanced in recent theoretical literature concerning a particular type of hospital
not chanlleging
(E)emphasizing the advantages of one particular type of hospital over another type

2. The passage suggests which of the following about the managers mentioned In the highlighted text?
. Conversely, while profit motive Is thought to encourage for-profit hospitals to attain efficient production, most theorists admit that obstacles to that efficiency remain. For-profit hospital managers, for example, generally work independently of hospital owners and thus may not always make maximum financial efficiency their highest priority.

(A) They have generally been motivated to streamline hospital services as a result of direct intervention by hospital owners.
motiveted ... result ... direct intervention ... -- not okie
(B)They are more likely than managers of nonprofit hospitals to use unnecessary amounts of resources to provide services.
Conversely .... remain ---> change meaning
(C) Their most important self-acknowledged goal is to achieve maximum financial efficiency so that hospitals show a profit.
inverted meaning
(D) Their decisions regarding services provided by their hospitals may not reflect hospital owners' priorities.
okie
(E) They do not place a high priority on maximizing profits, despite their desire to achieve efficiency.
too strong meaning

3. The author mentions duplication between departments primarily in order to
(A) illustrate an area in which nonprofit hospitals fail to provide adequate services
not okie
(B) describe the outcome of nonprofit hospitals' emphasis on maintaining managerial freedom
outcome of nonprofit hospitals' emphasis ... not okie
(C) recommend a particular change that would allow nonprofit hospitals to streamline their services
recommend a particular change ... recommend : not okie
(D) suggest a way in which nonprofit hospitals may fail to achieve maximum financial efficiency
??? okie
(E) explain why nonprofit hospitals may be able to provide more services than for-profit hospitals
not okie
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
Can someone please explain how the answer to third question is D and not E? From the passage: "For-profit hospital managers, for example, generally work independently of hospital owners and thus may not always make maximum financial efficiency their highest priority."

3. The passage suggests which of the following about the managers mentioned in the highlighted text?
A. They have generally been motivated to streamline hospital services as a result of direct intervention by hospital owners.
B. They are more likely than managers of nonprofit hospitals to use unnecessary amounts of resources to provide services.
C. Their most important self-acknowledged goal is to achieve maximum financial efficiency so that hospitals show a profit.
D. Their decisions regarding services provided by their hospitals may not reflect hospital owners' priorities.
E. They do not place a high priority on maximizing profits, despite their desire to achieve efficiency.
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
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powellmittra wrote:
Can someone please explain how the answer to third question is D and not E? From the passage: "For-profit hospital managers, for example, generally work independently of hospital owners and thus may not always make maximum financial efficiency their highest priority."

3. The passage suggests which of the following about the managers mentioned in the highlighted text?
A. They have generally been motivated to streamline hospital services as a result of direct intervention by hospital owners.
B. They are more likely than managers of nonprofit hospitals to use unnecessary amounts of resources to provide services.
C. Their most important self-acknowledged goal is to achieve maximum financial efficiency so that hospitals show a profit.
D. Their decisions regarding services provided by their hospitals may not reflect hospital owners' priorities.
E. They do not place a high priority on maximizing profits, despite their desire to achieve efficiency.

Hi Powerllmittra,

what I have learned from reading CR passages is that the entire answer prompt has to match the information provided in the text; and, while the text does state that for-profit hospital managers do not put emphasis on maximizing profits, yet nowhere in the passage does it say managers desire (also quite a strong word to use for correct answer choice) to achieve efficiency.
It is quite easy to assume that, yet this does not follow from the passage.

On the other hand, in the passage we do have that "managers work independently of the hospital's owners and thus may not always make maximum financial efficiency their highest priority", which does match answer choice D - that "and" implies that working independently and not maximizing profits are related.

I hope this helps
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
Took 7 mins and 10 seconds , including 2 mins 20 seconds to read the passage
-The author does not provide an opinion
- The author talks about For profit and non profit hospitals and explains differences between them
-The author also talks about the contrasting literature for non profit hospitals

1.
The second praragraph talks about only Non profit hospitals and 2 contrasting views about Non profit hospitals.
Only option (A) accurately captures the content of the second paragraph and is hence the right answer.

2.
"Newhouse (1970) contends that nonprofit hospital managers unnecessarily expand the quality and quantity of hospital care beyond the actual needs of the community"
The above excerpt shows that Newhouse hospital managers unnecessarily expanded the quality and quantity of Hospital Care was inappropriate. Hence option (E)

3.
"For-profit hospital managers, for example, generally work independently of hospital owners and thus may not always make maximum financial efficiency their highest priority"
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
For Quetion 2, I chose C because the text says:
Newhouse (1970) contends that nonprofit hospital managers unnecessarily expand the quality and quantity of hospital care beyond the actual needs of the community

From keyword "expand" and a bit of inference from Para 1 (which talks about non-profit hospitals as less efficient than for-profit hospital), I thought C would be the answer.
(C) argues that nonprofit hospitals are likely to spend more to provide services that the community requires than for-profit hospitals are likely to spend
Can someone point the error in my reasoning?
Thanks.
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Re: The United States hospital industry is an unusual market in that [#permalink]
AN225 wrote:
The United States hospital industry is an unusual market in that nonprofit and for-profit produce's exist simultaneously. Theoretical literature offers conflicting views on whether nonprofit hospitals are less financially efficient. Theory suggests that nonprofit hospitals are so much more interested in offering high-quality service than in making money that they frequently input more resources to provide the same output of service as for-profit hospitals. This priority might also often lead them to be less vigilant in streamlining their services—eliminating duplication between departments, for instance. Conversely, while profit motive Is thought to encourage for-profit hospitals to attain efficient production, most theorists admit that obstacles to that efficiency remain. For-profit hospital managers, for example, generally work independently of hospital owners and thus may not always make maximum financial efficiency their highest priority. The literature also suggests that widespread adoption of third-party payment systems may eventually eliminate any such potential differences between the two kinds of hospitals.

The same literature offers similarly conflicting views of the efficiency of nonprofit hospitals from a social welfare perspective. Newhouse (1970) contends that nonprofit hospital managers unnecessarily expand the quality and quantity of hospital care beyond the actual needs of the community, while Weisbrod (1975) argues that nonprofit firms-hospitals included—contribute efficiently to community welfare by providing public services that might be inadequately provided by government alone.

1. The passage is primarily concerned with

(A) discussing the advantages of increased efficiency in a particular type of hospital
(B) assessing obstacles to efficiency in a particular type of hospital
(C) describing conflicting assessments in the theoretical literature concerning particular types of hospitals
(D) Challenging evidence used to support an argument advanced in recent theoretical literature concerning a particular type of hospital
(E)emphasizing the advantages of one particular type of hospital over another type

2. The passage suggests which of the following about the managers mentioned In the highlighted text?

(A) They have generally been motivated to streamline hospital services as a result of direct intervention by hospital owners.
(B)They are more likely than managers of nonprofit hospitals to use unnecessary amounts of resources to provide services.
(C) Their most important self-acknowledged goal is to achieve maximum financial efficiency so that hospitals show a profit.
(D) Their decisions regarding services provided by their hospitals may not reflect hospital owners' priorities.
(E) They do not place a high priority on maximizing profits, despite their desire to achieve efficiency.

3. The author mentions duplication between departments primarily in order to

(A) illustrate an area in which nonprofit hospitals fail to provide adequate services
(B) describe the outcome of nonprofit hospitals' emphasis on maintaining managerial freedom
(C) recommend a particular change that would allow nonprofit hospitals to streamline their services
(D) suggest a way in which nonprofit hospitals may fail to achieve maximum financial efficiency
(E) explain why nonprofit hospitals may be able to provide more services than for-profit hospitals

Hi,
I am not able to understand the passage completely. few lines of 1st paragraph:
"For-profit hospital managers, for example, generally work independently of hospital owners and thus may not always make maximum financial efficiency their highest priority. The literature also suggests that widespread adoption of third-party payment systems may eventually eliminate any such potential differences between the two kinds of hospitals."
Please explain me the above lines. Also, If I am able to solve questions without understanding the passage, it that correct approach? will it help in long run ?
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
TheMechanic wrote:
All correct in 6mins 34seconds...happy to help in case some one needs any help!

GMATNinja
Q1,OPTION D
although i have marked the correct answer choice(A),i wanted to check my reasoning with option D

OPTION D:It provides an additional contrast between the two types of hospitals discussed earlier.

in the second paragraph, for-profit hospital is never mentioned.the paragraph only discusses the contrasting views of efficiency of non-profit hospitals from social welfare perspective
Newhouse says: not efficient
Weisbrod: efficient

please correct me if i am wrong
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
maggie27 wrote:
6 mins.

1.A
2.B
3.D

Need discussion on Q2. I feel the word "inappropriate" is too harsh in option E! However I am not fully confident of option B as well because it talks more for the profit organizations rather than the non-profit ones .

I also feel the word 'inappropriate' in choice (E) is quite hard. I picked answer choice (C) and found (B) the next possible correct answer. GMATNinja could you please help.
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
question 2 cannot be C because there is no comparision between for profit and non profit hospitals. Answer is E as the argument just states that the services provided are more than required.

Appropriate word was a problem for me..that was tricky.

anyways,

took around 6.5 mins

2 correct
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
Took 5 mins, 20 sec and got all 3 correct.

1.Which of the following best describes the overall content of the second paragraph of the passage?

(A) It describes views concerning a particular aspect of one of the types of hospitals discussed earlier. : Correct, particular aspect that "unnecessarily expand the quality and quantity of hospital care beyond the actual needs of the community" is then counter-attacked by Weisbrod.

(B) It describes an additional benefit of one of the types of hospitals discussed earlier. Though Weisbrod does explain a benefit. But this is partial answer. So you can hold on while eliminating but it will be incorrect. A is much more complete.

(C) It offers a potential solution to a problem inherent in the structure of the United States hospital industry. Incorrect. Nothing so mentioned in the passage.

(D) It provides an additional contrast between the two types of hospitals discussed earlier. Incorrect. There is no contrast between the two hospital types, that the passage reads in the second para. We are actually provided in the contrast of opinion on one particular type of hospital.

(E) It describes one of the consequences of the character of the United States hospital market. Incorrect.

2. According to the passage, Newhouse's view of the social welfare efficiency of nonprofit hospitals differs from Weisbrod's view in that Newhouse

(A) contends that government already provides most of the services that communities need. Incorrect. No opinion about the government provided.

(B) argues that for-profit hospitals are better at meeting actual community needs than are nonprofit hospitals. Incorrect. Faulty inference.

(C) argues that nonprofit hospitals are likely to spend more to provide services that the community requires than for-profit hospitals are likely to spend. Incorrect. Though the first half of the statement seems to be somewhat buyable, but the latter part "than for profit hospitals are likely to spend" is something not mentioned.

(D) argues that nonprofit hospitals ought to expand the services they provide to meet the community's demands. Incorrect. Distorted Statement.

(E) believes that the level of care provided by nonprofit hospitals is inappropriate, given the community's requirements. Correct. Focus on lines, "nonprofit hospital managers unnecessarily expand the quality and quantity of hospital care beyond the actual needs of the community."

3. The passage suggests which of the following about the managers mentioned in the highlighted text?

(A) They have generally been motivated to streamline hospital services as a result of direct intervention by hospital owners. Incorrect. That is not the context of the reasoning at all. Direct reject.

(B) They are more likely than managers of nonprofit hospitals to use unnecessary amounts of resources to provide services. Incorrect. Nothing like that mentioned.

(C) Their most important self-acknowledged goal is to achieve maximum financial efficiency so that hospitals show a profit. Incorrect. We cannot infer this.

(D) Their decisions regarding services provided by their hospitals may not reflect hospital owners' priorities. Correct. Focus on line, " generally work independently of hospital owners and thus may not always make maximum financial efficiency their highest priority."

Since they do not depend on hospital owners as decisions, it is not obvious that they will have financial efficiency as their highest priority. Retain this option.

(E) They do not place a high priority on maximizing profits, despite their desire to achieve efficiency. Incorrect. You cannot deduce that they desire efficiency. ( Do not choose an option if you see the former part to be something relevant in context of the passage, always evaluate the latter part.)

Thank you.
Give a kudos if you are happy with the explanation.

Regards,
Smiti.
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
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HI workout, u1983, broall

Can you add the below questions to passages, seems like missed

The passage is primarily concerned with

(A) discussing the advantages of increased efficiency in a particular type of hospital
(B) assessing obstacles to efficiency in a particular type of hospital
(C) describing conflicting assessments in the theoretical literature concerning particular types of hospitals
(D) Challenging evidence used to support an argument advanced in recent theoretical literature concerning a particular type of hospital
(E)emphasizing the advantages of one particular type of hospital over another type

OA:

3. The author mentions duplication between departments primarily in order to

(A) illustrate an area in which nonprofit hospitals fail to provide adequate services
(B) describe the outcome of nonprofit hospitals' emphasis on maintaining managerial freedom
(C) recommend a particular change that would allow nonprofit hospitals to streamline their services
(D) suggest a way in which nonprofit hospitals may fail to achieve maximum financial efficiency
(E) explain why nonprofit hospitals may be able to provide more services than for-profit hospitals

OA:
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
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Can someone please explain why Q5 is D and not C?
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
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Can someone please explain why Q5 is D and not C?

Hi, I do agree that OA for Q5 looks doubtful, however if you carefully go through the relevant lines in the passage:

Theory suggests that nonprofit hospitals are so much more interested in offering high-quality service than in making money that they frequently input more resources to provide the same output of service as for-profit hospitals. This priority might also often lead them to be less vigilant in streamlining their services—eliminating duplication between departments, for instance.

The passage is clearly talking about the financial efficiency of the two types of hospitals. Therefore looking at the answer choices carefully:

5. The author mentions duplication between departments primarily in order to

(A) illustrate an area in which nonprofit hospitals fail to provide adequate services (totally irrelevant, not what is discussed in the passage. Eliminate)
(B) describe the outcome of nonprofit hospitals' emphasis on maintaining managerial freedom (no mention of managerial freedom in context to duplication between departments. Eliminate)
(C) recommend a particular change that would allow nonprofit hospitals to streamline their services (The passage doesn't recommend this change, it actually mentions it to bolster the idea that non profit hospitals don't bother about making money. Eliminate).
(D) suggest a way in which nonprofit hospitals may fail to achieve maximum financial efficiency (yeah, if non profit hospitals continue to do that there definitely will be more expenditure, the best choice among all)
(E) explain why nonprofit hospitals may be able to provide more services than for-profit hospitals (not really, duplication is instead mentioned as a reason for not being profitable. eliminate)

The answers choices are tricky but if you read carefully, only D will remain while all others can be eliminated. By the way I also marked C .
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
Can someone explain the Q5. Eliminating
Quote:
Financial Efficiency
can not digest . As the previous line talks about only Vigilant in Services
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The United States hospital industry is an unusual market in that nonpr [#permalink]
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LoneSurvivor wrote:
Can someone explain the Q5. Eliminating
Quote:
Financial Efficiency
can not digest . As the previous line talks about only Vigilant in Services

Question 5 - purpose
Hyphenated text is usually given to explain something or provide examples. Logically "eliminating duplication" refers to "streamlining their services" and clearly eliminating duplication is a means by which hospitals could improve efficiency, financial or otherwise.

A is incorrect - we aren't given any indication whether some hospitals are more efficient than others. The whole passage is actually a discussion really.
B is incorrect - we are in no shape or form told that Not For Profits (NFPs) emphasise managerial freedom
C is incorrect - this is NOT a recommendation... its logically and grammatically either an explanation or definition. Nonetheless the text talks about an example of streamlining in general.
D is correct - earlier in the same sentence I've mentioned above we are told how "this (quality of service) priority might..lead them (NFPs) to be less vigilant in streamlining" and then the sentence goes on to give an example of a forgone efficiency improvement. D is clearly the answer.
E is incorrect - The whole passage discusses both. It never gives preference to either.
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Re: The United States hospital industry is an unusual market in that nonpr [#permalink]
GMATNinja wrote:

Question 2, Explained

Question #2 is quite targeted:

Quote:
2. According to the passage, Newhouse's view of the social welfare efficiency of nonprofit hospitals differs from Weisbrod's view in that Newhouse...

Let's focus on what this question is asking:
• What is Newhouse's view
• of social welfare efficiency
• of nonprofit hospitals
• in contrast to Weisbrod's view?

Newhouse and Weisbrod are not mentioned at all in the first paragraph. The author never links them to the first paragraph. Consequently, everything we need to answer this question is in the second paragraph. We know that Newhouse thinks "nonprofit hospital managers unnecessarily expand the quality and quantity of hospital care beyond the actual needs of the community." It's up to us to look for something matching this description, and to eliminate choices that stray outside these lines.

Quote:
(D) argues that nonprofit hospitals ought to expand the services they provide to meet the community's demands.

Newhouse says that nonprofit hospital managers' expansion of services is unnecessary, given the community's needs. Eliminate (D).

Quote:
(E) believes that the level of care provided by nonprofit hospitals is inappropriate, given the community's requirements.

This is the best answer choice by far, because it sticks closely to what the passage tells us about Newhouse.

• Passage: Newhouse contends that nonprofit hospital managers expand the quality and quantity of care beyond actual community needs.
• Choice (E): Newhouse believes this level of care is inappropriate when taking into account the community's requirements.

It's a solid match and every other choice has been proven incorrect, so we'll stick with (E) as the best answer choice available.

I hope that my explanation clarifies why (C) and (B) are not correct. In choice (E), "inappropriate" is a perfectly acceptable word for two reasons:

• The definition of "inappropriate" is "not suitable or proper for the circumstances." This word is often used in an individual, pejorative context (e.g., inappropriate behavior, an inappropriate statement at a team meeting). However, we could say that a company's projection of revenue for Q3 was inappropriate, given a recent contraction in their supply chain. We could also say that the selection of vacuum cleaners available in a local shop was inappropriate for the kinds of floors built in most houses surrounding the shop.
• In this answer choice, the circumstances are clearly described. The quality of nonprofit hospital care is inappropriate, given the actual needs of the community. This is a reasonable way to describe Newhouse' view of nonprofit hospital care, so (E) remains a fine answer choice.

hi experts, would you please elaborate Q2 further, especial choice D
foe me, passage says the expansion is too much, beyond actual need.
my understanding of D is that the expansion should be meet the actual requirement.

that's why I picked up D.
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