In the previous year, home prices have continued to fall,
and many new homes remain on the market. The housing
market clearly indicates an economic downswing, which
could also have an impact on consumer spending, but recent
(5) analysis shows that inflation-adjusted consumer spending
appears to have grown at an annual rate of 2.7% with a
quarter of the year still remaining. Although that figure is
below last year's growth rate of 3.4%, this year's growth
remains positive, indicating that so far household spending
(10) has not taken the downturn that economists predicted.
However, several different factors make it possible to project
that consumer spending will decrease dramatically within the
next few months. Last quarter's consumer confidence
surveys indicate that that confidence has declined due to a
(15) softer job market, tighter credit, and falling home prices.
Retail surveys are reporting that consumers have recently
begun to spend less on clothing, but the surveys do not
indicate whether or not unseasonably warm temperature are
causing the trend rather than a decrease in consumer
(20) confidence. Businesses have been more reluctant to purchase
new equipment, which indicates that plans for future
construction may have to be put on hold. With only one
quarter of the year remaining, it is possible that this year's
spending could register as a deficit, but in order for that to
(25) occur, actual individual and business spending will have to
match the dramatic decrease that has so far only been
predicted.
Q. It can be inferred from the passage that the author believes the current year's spending will follow which of the following patterns?
A. It will reduce drastically within the final quarter and register as a deficit by the end of the year.
B. It will continue on a gradual upswing and surpass the previous year's growth rate.
C. It will not reduce drastically but will still register as an overall deficit by the end of the year.
D. It will decrease drastically at the beginning of the quarter but will improve radically at the last minute.
E. It is likely to be lower than the previous year's, but it will still reflect positive growth.
OA : E
Could someone please explain why option Ais wrong?
and many new homes remain on the market. The housing
market clearly indicates an economic downswing, which
could also have an impact on consumer spending, but recent
(5) analysis shows that inflation-adjusted consumer spending
appears to have grown at an annual rate of 2.7% with a
quarter of the year still remaining. Although that figure is
below last year's growth rate of 3.4%, this year's growth
remains positive, indicating that so far household spending
(10) has not taken the downturn that economists predicted.
However, several different factors make it possible to project
that consumer spending will decrease dramatically within the
next few months. Last quarter's consumer confidence
surveys indicate that that confidence has declined due to a
(15) softer job market, tighter credit, and falling home prices.
Retail surveys are reporting that consumers have recently
begun to spend less on clothing, but the surveys do not
indicate whether or not unseasonably warm temperature are
causing the trend rather than a decrease in consumer
(20) confidence. Businesses have been more reluctant to purchase
new equipment, which indicates that plans for future
construction may have to be put on hold. With only one
quarter of the year remaining, it is possible that this year's
spending could register as a deficit, but in order for that to
(25) occur, actual individual and business spending will have to
match the dramatic decrease that has so far only been
predicted.
Q. It can be inferred from the passage that the author believes the current year's spending will follow which of the following patterns?
A. It will reduce drastically within the final quarter and register as a deficit by the end of the year.
B. It will continue on a gradual upswing and surpass the previous year's growth rate.
C. It will not reduce drastically but will still register as an overall deficit by the end of the year.
D. It will decrease drastically at the beginning of the quarter but will improve radically at the last minute.
E. It is likely to be lower than the previous year's, but it will still reflect positive growth.
OA : E
Could someone please explain why option Ais wrong?
