January 27th, 2010 | 
Author: Most large corporations in the United States were once run by individual capitalists who owned enough stock to dominate the board of directors and dictate company policy. Because putting such large amounts of stock on the market would only depress its value, they could not sell out for a quick profit and instead had to concentrate on improving the long-term productivity of their companies. Today, with few exceptions, the stock of large United States corporations is held by large institutions—pension funds, for example—and because these institutions are prohibited by antitrust laws from owning a majority of a company’s stock and from actively influencing a company’s decision-making, they can enhance their wealth only by buying and selling stock in anticipation of fluctuations in its value. A minority shareholder is necessarily a short term trader. As a result, United States productivity is unlikely to improve unless shareholders and the managers of the companies in which they invest are encouraged to enhance long-term productivity (and hence long-term profitability), rather than simply to maximize short-term profits.
Since the return of the old-style capitalist is unlikely, today’s short-term traders must be remade into tomorrow’s long-term capitalistic investors. The legal limits that now prevent financial institutions from acquiring a dominant shareholding position in a corporation should be removed, and such institutions encouraged to take a more active role in the operations of the companies in which they invest. In addition, any institution that holds twenty percent or more of a company’s stock should be forced to give the public one day’s notice of the intent to sell those shares. Unless the announced sale could be explained to the public on grounds other than anticipated future losses, the value of the stock would plummet and, like the old-time capitalists, major investors could cut their losses only by helping to restore their companies’ productivity. Such measures would force financial institutions to become capitalists whose success depends not on trading shares at the propitious moment, but on increasing the productivity of the companies in which they invest.
1. In the passage, the author is primarily concerned with doing which of the following?
(A) Comparing two different approaches to a problem
(B) Describing a problem and proposing a solution
(C) Defending an established method
(D) Presenting data and drawing conclusions from the data
(E) Comparing two different analyses of a current situation
2. It can be inferred from the passage that which of the following is true of majority shareholders in a corporation?
(A) They make the corporation’s operational management decisions.
(B) They are not allowed to own more than fifty percent of the corporation’s stock.
(C) They cannot make quick profits by selling their stock in the corporation.
(D) They are more interested in profits than in productivity.
(E) They cannot sell any of their stock in the corporation without giving the public advance notice.
3. According to the passage, the purpose of the requirement suggested in lines 30-33 would be which of the following?
(A) To encourage institutional stockholders to sell stock that they believe will decrease in value
(B) To discourage institutional stockholders from intervening in the operation of a company whose stock they own
(C) To discourage short-term profit-taking by institutional stockholders
(D) To encourage a company’s employees to take an active role in the ownership of stock in the company
(E) To encourage investors to diversify their stock holdings
4. Which of the following best explains the author’s statement that “A minority shareholder is necessarily a short-term trader” ?
(A) The only way a minority shareholder can make money from stocks is to buy and sell stocks as prices fluctuate over short periods of time.
(B) Only a shareholder who owns a majority of a company’s stock can influence the trading price of the stock over a long period of time.
(C) A minority shareholder is prohibited by law from buying stock and holding it for long-term profits.
(D) Large institutions like pension funds cannot legally own a majority of any corporation’s stock.
(E) A minority shareholder rarely takes an interest in the decisions of a corporation’s board of directors.
5. The author suggests that which of the following is a true statement about people who typify the “old style capitalist” ?
(A) They now rely on outdated management techniques.
(B) They seldom engaged in short-term trading of the stock they owned.
(C) They did not influence the investment policies of the corporations in which they invested.
(D) They now play a much smaller role in the stock market as a result of antitrust legislation.
(E) They were primarily concerned with maximizing the short-term profitability of the corporations in which they owned stock.
Highlight to see answers: 1. B 2. D 3. C 4. A 5. B
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The function of government is to satisfy the genuine wants of the masses, and government cannot satisfy those wants unless it is informed about what those wants are. Freedom of speech ensures that such information will reach the ears of government officials. Therefore, freedom of speech is indispensable for a healthy state.
Which one of the following, if true, would NOT undermine the conclusion of the argument?
- People most often do not know what they genuinely want.
- Freedom of speech tends ultimately to undermine social order, and social order is a prerequisite for satisfying the wants of the masses.
- The proper function of government is not to satisfy wants, but to provide equality of opportunity.
- Freedom of speech is not sufficient for satisfying the wants of the masses: social order is necessary as well.
- Rulers already know what the people want.
Highlight to see answer: D
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Most North Carolina ski resorts broadcast music onto the slopes; skiers can choose among hard rock, soft pop, and “beautiful music” slopes, there are no slopes without music.
(A) skiers can choose among hard rock, soft pop, and “beautiful music” slopes, there are
(B) because skiers can choose hard rock, soft pop, or “beautiful music,” there are
(C) however, skiers can choose among hard rock, soft pop, “beautiful music,” and
(D) although skiers can choose among hard rock, soft pop, and “beautiful music” slopes, there are
(E) skiers can choose among hard rock, soft pop, “beautiful music” slopes, but
Highlight to see answer: D
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In most earthquakes the Earth’s crust cracks like porcelain. Stress builds up until a fracture forms at a depth of a few kilometers and the crust slips to relieve the stress. Some earthquakes, however, take place hundreds of kilometers down in the Earth’s mantle, where high pressure makes rock so ductile that it flows instead of cracking, even under stress severe enough to deform it like putty. How can there be earthquakes at such depths?
That such deep events do occur has been accepted only since 1927, when the seismologist Kiyoo Wadati convincingly demonstrated their existence. Instead of comparing the arrival times of seismic waves at different locations, as earlier researchers had done. Wadati relied on a time difference between the arrival of primary (P) waves and the slower secondary (S) waves. Because P and S waves travel at different but fairly constant speeds, the interval between their arrivals increases in proportion to the distance from the earthquake focus, or rupture point.
For most earthquakes, Wadati discovered, the interval was quite short near the epicenter, the point on the surface where shaking is strongest. For a few events, however, the delay was long even at the epicenter. Wadati saw a similar pattern when he analyzed data on the intensity of shaking. Most earthquakes had a small area of intense shaking, which weakened rapidly with increasing distance from the epicenter, but others were characterized by a lower peak intensity, felt over a broader area. Both the P-S intervals and the intensity patterns suggested two kinds of earthquakes: the more common shallow events, in which the focus lay just under the epicenter, and deep events, with a focus several hundred kilometers down.
The question remained: how can such quakes occur, given that mantle rock at a depth of more than 50 kilometers is too ductile to store enough stress to fracture? Wadati’s work suggested that deep events occur in areas (now called Wadati-Benioff zones) where one crustal plate is forced under another and descends into the mantle. The descending rock is substantially cooler than the surrounding mantle and hence is less ductile and much more liable to fracture.
1. The passage is primarily concerned with
(A) demonstrating why the methods of early seismologists were flawed
(B) arguing that deep events are poorly understood and deserve further study
(C) defending a revolutionary theory about the causes of earthquakes and methods of predicting them
(D) discussing evidence for the existence of deep events and the conditions that allow them to occur
(E) comparing the effects of shallow events with those of deep events
2. The author uses the comparisons to porcelain and putty in order to
(A) explain why the Earth’s mantle is under great pressure
(B) distinguish the earthquake’s epicenter from its focus
(C) demonstrate the conditions under which a Wadati-Benioff zone forms
(D) explain why S waves are slower than P waves
(E) illustrate why the crust will fracture but the mantle will not
3. It can be inferred from the passage that if the S waves from an earthquake arrive at a given location long after the P waves, which of the following must be true?
(A) The earthquake was a deep event.
(B) The earthquake was a shallow event.
(C) The earthquake focus was distant.
(D) The earthquake focus was nearby.
(E) The earthquake had a low peak intensity.
4. The method used by Wadati to determine the depths of earthquakes is most like which of the following?
(A) Determining the depth of a well by dropping stones into the well and timing how long they take to reach the bottom
(B) Determining the height of a mountain by measuring the shadow it casts at different times of the day
(C) Determining the distance from a thunderstorm by timing the interval between the flash of a lightning bolt and the thunder it produces
(D) Determining the distance between two points by counting the number of paces it takes to cover the distance and measuring a single pace
(E) Determining the speed at which a car is traveling by timing how long it takes to travel a known distance
5. The passage supports which of the following statements about the relationship between the epicenter and the focus of an earthquake?
(A) P waves originate at the focus and S waves originate at the epicenter.
(B) In deep events the epicenter and the focus are reversed.
(C) In shallow events the epicenter and the focus coincide.
(D) In both deep and shallow events the focus lies beneath the epicenter.
(E) The epicenter is in the crust, whereas the focus is in the mantle.
6. The passage suggests that which of the following must take place in order for any earthquake to occur?
I. Stress must build up.
II. Cool rock must descend into the mantle.
III. A fracture must occur.
(A) I only
(B) II only
(C) III only
(D) I and III only
(E) I, II, and III
7. Information presented in the passage suggests that, compared with seismic activity at the epicenter of a shallow event, seismic activity at the epicenter of a deep event is characterized by
(A) shorter P-S intervals and higher peak intensity
(B) shorter P-S intervals and lower peak intensity
(C) longer P-S intervals and similar peak intensity
(D) longer P-S intervals and higher peak intensity
(E) longer P-S intervals and lower peak intensity
8. The passage suggests which of the following about the views held by researchers before 1927?
(A) Some researchers did not believe that deep events could actually occur.
(B) Many researchers rejected the use of P-S intervals for determining the depths of earthquakes.
(C) Some researchers doubted that the mantle was too ductile to store the stress needed for an earthquake.
(D) Most researchers expected P waves to be slower than S waves.
(E) Few researchers accepted the current model of how shallow events occur.
9. The author’s explanation of how deep events occur would be most weakened if which of the following were discovered to be true?
(A) Deep events are far less common than shallow events.
(B) Deep events occur in places other than where crustal plates meet.
(C) Mantle rock is more ductile at a depth of several hundred kilometers than it is at 50 kilometers.
(D) The speeds of both P and S waves are slightly greater than previously thought.
(E) Below 650 kilometers earthquakes cease to occur.
Highlight to see answers: 1. C 2. E 3. A 4. C 5. D 6. D 7. E 8. A 9. B
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Most discussions of the factors contributing to improvements in public health greatly underestimate the influence of the values held by individuals. This influence is indicated by the fact that the astonishing decline in mortality from infectious disease during the past century was primarily due to an improvement in living conditions. To a substantial degree, these improvements depended on the emphasis by an increasing share of the population on cleanliness, prudence, and moderation.
The main point of the passage is made primarily by
(A) analyzing existing data on medical practices and health outcomes
(B) presenting a set of related cause-and-effect assertions
(C) applying several general principles to a specific case
(D) presenting a general observation and supporting it with several specific examples
(E) refuting in detail a commonly accepted argument
Highlight to see answer: B
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