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03 Aug 2024, 11:20
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Researchers have found that workers in firms with fewer than 20 employees are, on average, little more than half as productive as the workers in firms with 250 or more, and that, overall, a bias toward small firms is economically costly.
These researchers blame strict employment regulations for the small sizes of firms: because small firms are sheltered from these regulations, they act as a tax on large firm size. For example, the researchers attribute the steep drop in the number of manufacturing firms in Nation E with precisely 50 or more workers (see the Data tab) to just such regulations. Across both manufacturing and service sectors and for firms of various sizes, firms that might have grown bigger have chosen to stay small. The result is significantly less productivity per employee.
These researchers blame strict employment regulations for the small sizes of firms: because small firms are sheltered from these regulations, they act as a tax on large firm size. For example, the researchers attribute the steep drop in the number of manufacturing firms in Nation E with precisely 50 or more workers (see the Data tab) to just such regulations. Across both manufacturing and service sectors and for firms of various sizes, firms that might have grown bigger have chosen to stay small. The result is significantly less productivity per employee.
The average firm size will increase.: Yes
Productivity per employee will increase.: Yes
The average productivity per employee across all firms with exactly 200 employees will increase.: No
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
65%
(hard)
Question Stats:
51% (03:22) correct
49%
(03:28)
wrong
based on 1252
sessions
History
Date
Time
Result
Not Attempted Yet
Suppose that Nation X’s present pattern of manufacturing productivity, per employee, aligns with the graph displaying the average productivity by size of manufacturing firm, and that Nation X has recently repealed most of the regulations listed in Tab 2. For each of the following statements, select Yes if the information provided clearly suggests that the statement describes a result of this change that would be expected by the researchers. Otherwise, select No.
| Yes | No | |
| The average firm size will increase. | ||
| Productivity per employee will increase. | ||
| The average productivity per employee across all firms with exactly 200 employees will increase. |
ShowHide Answer
Official Answer
The average firm size will increase.: Yes
Productivity per employee will increase.: Yes
The average productivity per employee across all firms with exactly 200 employees will increase.: No
Nation A: No
Nation B: No
Nation I: Yes
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
5%
(low)
Question Stats:
81% (01:18) correct
19%
(01:30)
wrong
based on 1197
sessions
History
Date
Time
Result
Not Attempted Yet
For each of the following nations, select Yes if the information provided suggests that the country's manufacturing productivity per employee is higher than Nation E’s. Otherwise, select No.
| Yes | No | |
| Nation A | ||
| Nation B | ||
| Nation I |
ShowHide Answer
Official Answer
Nation A: No
Nation B: No
Nation I: Yes
Why firms are often smaller than considerations of productivity suggest they should be
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
25%
(medium)
Question Stats:
72% (00:56) correct
28%
(01:01)
wrong
based on 1219
sessions
History
Date
Time
Result
Not Attempted Yet
The passage in the Firm Size tab most clearly aims to explain which one of the following?
| Why regulatory scrutiny of employers in Nation X begins in earnest when the number of employees is 20 or greater | |
| Why certain countries have stricter employment laws than other countries | |
| Why firms are often smaller than considerations of productivity suggest they should be | |
| Why some smaller firms are more productive than some larger firms | |
| Why larger firms are more productive than smaller firms |
ShowHide Answer
Official Answer
Why firms are often smaller than considerations of productivity suggest they should be
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21 Sep 2024, 08:33
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Q:1
Stat1: The average firm size will increase → As the nation X repealed regulations stated in Tab 2, the industries in the nation are freed from restrictions and therefore, they will increase their firm size. → Yes
Stat2: Productivity per employee will increase → It is clearly stated in the Tab 1 that
workers in firms with fewer than 20 employees are, on average, little more than half as productive as the workers in firms with 250 or more
Thus, as the firm size will increase, the productivity will also soar up. → Yes
Stat3: The average productivity per employee across all firms with exactly 200 employees will increase→ Since passages talk about 2 figures clearly i.e. 20 and 250. Nothing is mentioned about 200. → No
Q:2
Open Tab 3 and look at the figure of Dist. of employees by size of firm. As we know that firms having 250+ workers are more productive than others. Now compare Nation E with Nation A in respect with the size of 250+ workers' firm. We find that E has a large portion of 250+ firms than A. Similarly compare the other 2 option B and I. We find that
A→ No (Blue portion is smaller than E)
B→ No (Blue portion is smaller than E)
I→ Yes (Blue portion is larger than E)
Q:3
→ Why regulatory scrutiny of employers in Nation X begins in earnest when the number of employees is 20 or greater→ In the Tab 1(Firm Size), Researchers exemplified Nation E not X→ Reject
→ Why certain countries have stricter employment laws than other countries→ Researchers didn't compare the different employment laws of certain nations→ Reject
→ Why firms are often smaller than considerations of productivity suggest they should be→ Tab 1 stated this clearly that
→ Why some smaller firms are more productive than some larger firms→ Nothing is mentioned related to this question. Rather research finds that productivity is clustered in large firms though this is not the main concern of the Tab→ Reject
→ Why larger firms are more productive than smaller firms→ Though it mentioned firms having 250+ employees are more productive than firms having less than 20 employees. But if the firm size is far more than 250 what would be the output of the same research. We don't know→ Reject
Stat1: The average firm size will increase → As the nation X repealed regulations stated in Tab 2, the industries in the nation are freed from restrictions and therefore, they will increase their firm size. → Yes
Stat2: Productivity per employee will increase → It is clearly stated in the Tab 1 that
workers in firms with fewer than 20 employees are, on average, little more than half as productive as the workers in firms with 250 or more
Thus, as the firm size will increase, the productivity will also soar up. → Yes
Stat3: The average productivity per employee across all firms with exactly 200 employees will increase→ Since passages talk about 2 figures clearly i.e. 20 and 250. Nothing is mentioned about 200. → No
Q:2
Open Tab 3 and look at the figure of Dist. of employees by size of firm. As we know that firms having 250+ workers are more productive than others. Now compare Nation E with Nation A in respect with the size of 250+ workers' firm. We find that E has a large portion of 250+ firms than A. Similarly compare the other 2 option B and I. We find that
A→ No (Blue portion is smaller than E)
B→ No (Blue portion is smaller than E)
I→ Yes (Blue portion is larger than E)
Q:3
→ Why regulatory scrutiny of employers in Nation X begins in earnest when the number of employees is 20 or greater→ In the Tab 1(Firm Size), Researchers exemplified Nation E not X→ Reject
→ Why certain countries have stricter employment laws than other countries→ Researchers didn't compare the different employment laws of certain nations→ Reject
→ Why firms are often smaller than considerations of productivity suggest they should be→ Tab 1 stated this clearly that
Quote:
This indicates why firms tend to be kept smaller → Accept
→ Why some smaller firms are more productive than some larger firms→ Nothing is mentioned related to this question. Rather research finds that productivity is clustered in large firms though this is not the main concern of the Tab→ Reject
→ Why larger firms are more productive than smaller firms→ Though it mentioned firms having 250+ employees are more productive than firms having less than 20 employees. But if the firm size is far more than 250 what would be the output of the same research. We don't know→ Reject
General Discussion
05 Aug 2024, 11:34
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My take on Q1- The first Tab explicilty mentions that , the productivity of employees in companies having less than 20 employees is slightly greater than half of productivity of emplyees in companies having over 250 employees.
We are also given that , it is the regulations that are holding back companies from increasing the staff and hence the productivity.
The question asks , what would happen if in Nation X , the regulations are removed ------> The size of the companies will increase and so will their producivity.
1- Answer should be yes
2- Yes
3- No , because we are given comparison of companies having less than 20 and more thaan 250 employees and nothing about companies with exactly 200.
Experts please give your opinion.
We are also given that , it is the regulations that are holding back companies from increasing the staff and hence the productivity.
The question asks , what would happen if in Nation X , the regulations are removed ------> The size of the companies will increase and so will their producivity.
1- Answer should be yes
2- Yes
3- No , because we are given comparison of companies having less than 20 and more thaan 250 employees and nothing about companies with exactly 200.
Experts please give your opinion.
