Millions of people worldwide play multiplayer online games. They each

Question

Passage A is from a source published in 2004 and passage B is from a source published in 2007.

Passage A

Millions of people worldwide play multiplayer
online games. They each pick, say, a medieval
character to play, such as a warrior. Then they might
band together in quests to slay magical beasts; their
  (5)   avatars appear as tiny characters striding across a
Tolkienesque land.

The economist Edward Castronova noticed
something curious about the game he played: it had
its own economy, a bustling trade in virtual goods.
  (10)   Players generate goods as they play, often by killing
creatures for their treasure and trading it. The longer
they play, the wealthier they get.

Things got even more interesting when Castronova
learned about the “player auctions.” Players would
  (15)   sometimes tire of the game and decide to sell off their
virtual possessions at online auction sites.

As Castronova stared at the auction listings, he
recognized with a shock what he was looking at. It
was a form of currency trading! Each item had a value
  (20)   in the virtual currency traded in the game; when it was
sold on the auction site, someone was paying cold hard
cash for it. That meant that the virtual currency was
worth something in real currency. Moreover, since
players were killing monsters or skinning animals to
  (25)   sell their pelts, they were, in effect, creating wealth.

Passage B

Most multiplayer online games prohibit
real-world trade in virtual items, but some actually
encourage it, for example, by granting participants
intellectual property rights in their creations.

(30)   Although it seems intuitively the case that
someone who accepts real money for the transfer of a
virtual item should be taxed, what about the player
who only accumulates items or virtual currency within
a virtual world? Is “loot” acquired in a game taxable,
  (35)   as a prize or award is? And is the profit in a purely
in-game trade or sale for virtual currency taxable?
These are important questions, given the tax revenues
at stake, and there is pressure on governments to
answer them, given that the economies of some virtual
  (40)   worlds are comparable to those of small countries.

Most people’s intuition probably would be that
accumulation of assets within a game should not be
taxed even though income tax applies even to noncash
accessions to wealth. This article will argue that
  (45)   income tax law and policy support that result. Loot
acquisitions in game worlds should not be treated as
taxable prizes and awards, but rather should be treated
like other property that requires effort to obtain, such
as fish pulled from the ocean, which is taxed only
  (50)   upon sale. Moreover, in-game trades of virtual items
should not be treated as taxable barter.

By contrast, tax doctrine and policy counsel
taxation of the sale of virtual items for real currency,
and, in games that are intentionally commodified,
  (55)   even of in-world sales for virtual currency, regardless
of whether the participant cashes out. This approach
would leave entertainment value untaxed without
creating a tax shelter for virtual commerce.    1 
 1. Which one of the following pairs of titles would be most appropriate for passage A and passage B, respectively?

(A) “The Economic Theories of Edward Castronova” “Intellectual Property Rights in Virtual Worlds”
(B) “An Economist Discovers New Economic Territory” “Taxing Virtual Property”
(C) “The Surprising Growth of Multiplayer Online Games” “Virtual Reality and the Law”
(D) “How to Make Money Playing Games” “Closing Virtual Tax Shelters”
(E) “A New Economic Paradigm” “An Untapped Source of Revenue”

2 
 2. Which one of the following most accurately expresses how the use of the phrase “skinning animals” in passage A (line 24) relates to the use of the phrase “fish pulled from the ocean” in passage B (line 49)?

(A) The former refers to an activity that generates wealth, whereas the latter refers to an activity that does not generate wealth.
(B) The former refers to an activity in an online game, whereas the latter refers to an analogous activity in the real world.
(C) The former, unlike the latter, refers to the production of a commodity that the author of passage B thinks should be taxed.
(D) The latter, unlike the former, refers to the production of a commodity that the author of passage B thinks should be taxed.
(E) Both are used as examples of activities by which game players generate wealth.

3 
 3. With regard to their respective attitudes toward commerce in virtual items, passage A differs from passage B in that passage A is more

(A) critical and apprehensive
(B) academic and dismissive
(C) intrigued and excited
(D) undecided but curious
(E) enthusiastic but skeptical

4 
 4. Based on what can be inferred from their titles, the relationship between which one of the following pairs of documents is most analogous to the relationship between passage A and passage B?

(A) “Advances in Artificial Intelligence” “Human Psychology Applied to Robots”
(B) “Internet Retailers Post Good Year” “Lawmakers Move to Tax Internet Commerce”
(C) “New Planet Discovered in Solar System” “Planet or Asteroid: Scientists Debate”
(D) “Biologists Create New Species in Lab” “Artificially Created Life: How Patent Law Applies”
(E) “A Renegade Economist’s Views on Taxation” “Candidate Runs on Unorthodox Tax Plan”

5 
 5. The passages were most likely taken from which one of the following pairs of sources?

(A) passage A: a magazine article addressed to a general audience passage B: a law journal article
(B) passage A: a technical journal for economists passage B: a magazine article addressed to a general audience
(C) passage A: a science-fiction novel passage B: a technical journal for economists
(D) passage A: a law journal article passage B: a speech delivered before a legislative body
(E) passage A: a speech delivered before a legislative body passage B: a science-fiction novel

6 
 6. Which one of the following most accurately describes the relationship between the two passages?

(A) Passage A summarizes a scholar’s unanticipated discovery, while passage B proposes solutions to a problem raised by the phenomenon discovered.
(B) Passage A explains an economic theory, while passage B identifies a practical problem resulting from that theory.
(C) Passage A reports on a subculture, while passage B discusses the difficulty of policing that subculture.
(D) Passage A challenges the common interpretation of a phenomenon, while passage B reaffirms that interpretation.
(E) Passage A states a set of facts, while passage B draws theoretical consequences from those facts.

7 
 7. Based on passage B, which one of the following is a characteristic of some “games that are intentionally commodified” (line 54)?

(A) The game allows selling real items for virtual currency.
(B) The game allows players to trade avatars with other players.
(C) Players of the game grow wealthier the longer they play.
(D) Players of the game own intellectual property rights in their creations.
(E) Players of the game can exchange one virtual currency for another virtual currency.

Sajjad1994 · Answer

Explanation

2. Which one of the following most accurately expresses how the use of the phrase “skinning animals” in passage A (line 24) relates to the use of the phrase “fish pulled from the ocean” in passage B (line 49)?

Explanation

This question is asking how each phrase is used in its respective passage. Passage A offers  “skinning animals”  as an example of an activity within a game that creates wealth. Passage B offers  “fish pulled from the ocean”  as an example of noncash property that requires effort to obtain and is not taxed until sale.

A. No.  While this is an accurate description of passage A’s discussion of the first phrase, this answer does not reflect passage B’s discussion of the fish pulled from the ocean as property (and therefore a form of wealth).

B.  Yes.   This accurately captures the idea that passage A offers  “skinning animals”  as an example of an activity within a game that creates wealth and that passage B offers  “fish pulled from the ocean”  as an example of noncash property that requires effort to obtain and is not taxed until sale.

C. No.  The author of passage B does not believe that acquisitions in game worlds should be taxed.

D. No.  The author of passage B does not believe that fish pulled from the ocean should be taxed.

E. No.  Passage B’s discussion of pulling fish from the ocean refers to a real world activity rather than a game world activity.

Answer: B

Sajjad1994 · Answer

Explanation

4. Based on what can be inferred from their titles, the relationship between which one of the following pairs of documents is most analogous to the relationship between passage A and passage B?

Explanation

The question is asking for an analogous relationship to that of passage A and passage B, specifically that passage A introduces a discovery and passage B discusses one legal issue that the discovery raises. (Note: You can approach this question similarly to a Parallel the Reasoning Arguments question.)

A. No.  The second title should refer to some kind of legal analysis of the discovery in the first title.

B. No.  The first title should refer to a discovery.

C. No.  The second title should refer to some kind of legal analysis of the discovery in the first title.

D.  Yes.   The first title mentions a discovery and the second mentions legal analysis of that title.

E. No.  The passages do not suggest that the idea that multiplayer online games have economies is renegade or unorthodox. Also, the second title should refer to some kind of legal analysis of the discovery in the first title.

Answer: D

Sajjad1994 · Answer

Explanation

6. Which one of the following most accurately describes the relationship between the two passages?

Explanation

The question asks for the relationship between the two passages. The correct answer will reflect that passage A introduces the idea that transactions within multiplayer online games are a form of economy, and passage B takes that idea one step farther and considers the tax implications.

A.  Yes.   This accurately describes the relationship between the passages.

B. No.  This answer does not reflect that passage A discusses a new idea.

C. No.  While multiplayer online gaming might be considered a subculture, passage A discusses a discovery about that subculture rather than reporting on it, and passage B discusses tax issues, not policing.

D. No.  Passage A discusses one economist’s discovery and neither passage discusses what a common interpretation would be.

E. No.  Passage A discusses a discovery, and passage B discusses real issues that arise from that discovery.

Answer: A

tarunrathi999 · Answer

Paragraph Summaries
Passage A

Description of online multiplayer games.
Edward Castronova notices that games have economies.
Castronova realized that players auction video game goods on online auction sites.
Video game players are creating real world wealth.

Passage B

Most games ban players from trading game items for money.
Questions about taxation of video game goods.
In-game only wealth should be treated like gathering fish: taxed only upon sale.
We should tax the sale of items earned in game. This prevents virtual tax shelters and is in line with tax policy.

Analysis
These two passages are completely different in tone, yet many students do not notice the difference. If you struggle with tone and author’s opinion questions, you should go over these passages with a fine toothed comb. Look for every word that indicates emotion or value judgement.

The first passage has a tone of excited discovery. Wow, look! There’s an economy here. This is so cool guys! Oh my god, they’re selling things! For money! Woooooo, economics!!

I’m exaggerating, but this passage is about as enthusiastic as LSAT reading comprehension passages will get. Take a look at the first sentence of paragraph 4 of passage A: “….Castronova stared…..he realized with a shock what he was looking at.”

Emphasis mine. I’ve never seen the LSAT describe someone as shocked, or experiencing any extreme emotion. This passage is astonishingly high on the LSAT emotional scale.

Notice that Castronova’s article was published in 2004. I was at university in 2004. We had desktop computers, and no one had cellphones. I think I had gotten a high speed internet connection six years prior.

So, massive online games were very new. This article reflects that newness. An economist was only just noticing that these games have economies, and he wasn’t looking for economies within the games. It was a surprise discovery.

The tone of passage B is very different. This article was published in 2007. The world has had three years to catch up to the fact that games have economies. Now the legal system has taken notice of online games. This paper discusses how to tax online game assets.

Tax policy? Bleh, so dull. In 2004 players would have been shocked that the government would take an interest in their games. But now (2014 at the time of writing) it’s obvious that game earnings have real value, and passage B reflects an early version of this understanding.

As for the content of passage B, the argument seems rather sensible. The author argues for a clean division between games as entertainment and games as centers of e-commerce.

This passage is interesting in that five out of seven questions are entirely based on the main point of each passage and the relationship between them. One question (number 8) is partially based on this, and only question 13 is based on specific details.

On every passage, you should ask yourself “why are they telling me this”. It’s a useful question everywhere. But on these passages, it’s essential.

Find all the answer here: https://lsathacks.com/explanations/lsat ... passage-2/

ArtemNYC · Answer

Hey guy! Could anyone explain please the no. 5 ? It's not clear for me to understand the A choice instead of B.

Sajjad1994 · Answer

A question asking about the source of a passage is best approached by considering the scope and tone of the passage. Look for clues in the passage about where it might have come from. Here, passage A is approachable, lacking technical language, and is positive in tone. Passage B notes that  “this article will argue”  an issue of tax law.

A. Yes.  Passage A is approachable, lacking technical language, and is positive in tone. Passage B notes that  “this article will argue”  an issue of tax law.

B. No.  Passage A lacks technical language, and passage B discusses points of tax law that would likely be inaccessible to a general audience.

Sajjad1994 · Answer

Explanation

1. Which one of the following pairs of titles would be most appropriate for passage A and passage B, respectively?

Explanation

A. No.  While there is a brief mention of intellectual property in the first paragraph, passage B focuses on tax issues. This answer choice’s description of passage A is also too broad; the passage considers only Castronova’s brief thoughts about economies within multiplayer online games.

B. Yes.   This answer choice reflects passage A’s focus on multiplayer online games as economies and passage B’s focus on tax issues within those games.

C. No.  While there is a brief mention of the popularity of multiplayer online games, passage A is focused on the economic activity within those games. Passage B focuses only on one area of the law—taxation.

D. No.  Passage A notes that people can exchange virtual goods for real currency but does not instruct people how to do so. Passage B argues against taxing transactions of virtual goods.

E. No.  While passage A does discuss a new type of economy, passage B does not argue that multiplayer online games should be a revenue source.

Answer: B

Millions of people worldwide play multiplayer online games. They each

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GMAT Reading Comprehension (RC) Questions

Millions of people worldwide play multiplayer online games. They each

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