I have a question regarding the below question from an official GMAT practice exam. Can someone tell me why choice D is correct?
Photos are attached showing screen shots of the reading and question.
RC: Difficult Question from Official GMAT
This topic has expert replies
- VivianKerr
- GMAT Instructor
- Posts: 1035
- Joined: Fri Dec 17, 2010 11:13 am
- Location: Los Angeles, CA
- Thanked: 474 times
- Followed by:365 members
Hey Melanie,
What was your breakdown for this passage/question? It would help to see that to pinpoint exactly what you may have missed here.
Here's how I'd breakdown the passage on my scratch pad:
Topic: wages
Scope: how it affects competition in dev. countries
1st chunk: to explain a theory and refute it
2nd chunk: to discuss additional factor
POV: lower wages abroad won't hurt, should be allowed to rise
Purpose: to emphasis why higher wages aren't bad
Question-type: Inference
Question Rephrase: What's implied if capital restricted?
Our job is to go back to the passage and find PRECISELY what it says regarding the keywords "capital" and "restrict".
From the passage:
Furthermore, if wages are not allowed to rise, the value of the country's currency will appreciate, which (from the developed countries' point of view) is the equivalent of increased wages in the developing country. And although in the past a few countries have deliberately kept their currencies undervalued, that is now much harder to do in a world where capital moves more freely.
Prediction: When capital isn't free, currencies can be undervalued = increased wages
(D) is the best match for this. The currency does actually go up in value, yet there is an increase in wages/productivity.
Hope this helps!
What was your breakdown for this passage/question? It would help to see that to pinpoint exactly what you may have missed here.
Here's how I'd breakdown the passage on my scratch pad:
Topic: wages
Scope: how it affects competition in dev. countries
1st chunk: to explain a theory and refute it
2nd chunk: to discuss additional factor
POV: lower wages abroad won't hurt, should be allowed to rise
Purpose: to emphasis why higher wages aren't bad
Question-type: Inference
Question Rephrase: What's implied if capital restricted?
Our job is to go back to the passage and find PRECISELY what it says regarding the keywords "capital" and "restrict".
From the passage:
Furthermore, if wages are not allowed to rise, the value of the country's currency will appreciate, which (from the developed countries' point of view) is the equivalent of increased wages in the developing country. And although in the past a few countries have deliberately kept their currencies undervalued, that is now much harder to do in a world where capital moves more freely.
Prediction: When capital isn't free, currencies can be undervalued = increased wages
(D) is the best match for this. The currency does actually go up in value, yet there is an increase in wages/productivity.
Hope this helps!
Vivian Kerr
GMAT Rockstar, Tutor
https://www.GMATrockstar.com
https://www.yelp.com/biz/gmat-rockstar-los-angeles
Former Kaplan and Grockit instructor, freelance GMAT content creator, now offering affordable, effective, Skype-tutoring for the GMAT at $150/hr. Contact: [email protected]
Thank you for all the "thanks" and "follows"!
GMAT Rockstar, Tutor
https://www.GMATrockstar.com
https://www.yelp.com/biz/gmat-rockstar-los-angeles
Former Kaplan and Grockit instructor, freelance GMAT content creator, now offering affordable, effective, Skype-tutoring for the GMAT at $150/hr. Contact: [email protected]
Thank you for all the "thanks" and "follows"!