Test: Reading Comprehension: Economics - GMAT MCQ
20 Questions MCQ Test - Test: Reading Comprehension: Economics
A recent report from the International Energy Agency (IEA) on international oil supplies indicates that oil prices could increase to over $100 a barrel because of the global energy shortage. The International Energy Agency, an organization representing the 26 nations of the Organization for Economic Cooperation and Development (OECD), is generally considered a reliable indicator of international energy supplies. In a distinct change from its former reports, the IEA has suggested in its recent report that world governments need to make urgent revisions on energy-related policies if a global energy crisis is to be avoided.
According to the report, the reason for the IEA's warning is its anticipation that economic progress will increase global energy demands by about 50% in the next fifteen years. The majority of this demand is expected to come from China and India, which will be accountable for over 60 percent of carbon emissions, the chief reason for global warming, by 2030. Another reason stated for the IEA’s cautionary notice is that the number of oil suppliers is steadily decreasing. Since oil deposits in the North Sea region will soon be exhausted, countries supplying oil will be limited to those in the Gulf of Persia.
The government can address this imminent crisis through just one policy change. A team of Harvard analysts has predicted that if oil production is considerably expanded, oil prices could fall in the next decade. The team maintains that if previously under-utilized sources of oil are harnessed and more funding is provided for the setting up of new local refineries, the impending crisis could be avoided.
According to the passage, the International Energy Agency agrees over which of the following?
A recent report from the International Energy Agency (IEA) on international oil supplies indicates that oil prices could increase to over $100 a barrel because of the global energy shortage. The International Energy Agency, an organization representing the 26 nations of the Organization for Economic Cooperation and Development (OECD), is generally considered a reliable indicator of international energy supplies. In a distinct change from its former reports, the IEA has suggested in its recent report that world governments need to make urgent revisions on energy-related policies if a global energy crisis is to be avoided.
According to the report, the reason for the IEA's warning is its anticipation that economic progress will increase global energy demands by about 50% in the next fifteen years. The majority of this demand is expected to come from China and India, which will be accountable for over 60 percent of carbon emissions, the chief reason for global warming, by 2030. Another reason stated for the IEA’s cautionary notice is that the number of oil suppliers is steadily decreasing. Since oil deposits in the North Sea region will soon be exhausted, countries supplying oil will be limited to those in the Gulf of Persia.
The government can address this imminent crisis through just one policy change. A team of Harvard analysts has predicted that if oil production is considerably expanded, oil prices could fall in the next decade. The team maintains that if previously under-utilized sources of oil are harnessed and more funding is provided for the setting up of new local refineries, the impending crisis could be avoided.
Which of the following can be derived on the basis of the information given in the passage?
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A recent report from the International Energy Agency (IEA) on international oil supplies indicates that oil prices could increase to over $100 a barrel because of the global energy shortage. The International Energy Agency, an organization representing the 26 nations of the Organization for Economic Cooperation and Development (OECD), is generally considered a reliable indicator of international energy supplies. In a distinct change from its former reports, the IEA has suggested in its recent report that world governments need to make urgent revisions on energy-related policies if a global energy crisis is to be avoided.
According to the report, the reason for the IEA's warning is its anticipation that economic progress will increase global energy demands by about 50% in the next fifteen years. The majority of this demand is expected to come from China and India, which will be accountable for over 60 percent of carbon emissions, the chief reason for global warming, by 2030. Another reason stated for the IEA’s cautionary notice is that the number of oil suppliers is steadily decreasing. Since oil deposits in the North Sea region will soon be exhausted, countries supplying oil will be limited to those in the Gulf of Persia.
The government can address this imminent crisis through just one policy change. A team of Harvard analysts has predicted that if oil production is considerably expanded, oil prices could fall in the next decade. The team maintains that if previously under-utilized sources of oil are harnessed and more funding is provided for the setting up of new local refineries, the impending crisis could be avoided.
Which of the following statements would the author most likely agree with?
A recent report from the International Energy Agency (IEA) on international oil supplies indicates that oil prices could increase to over $100 a barrel because of the global energy shortage. The International Energy Agency, an organization representing the 26 nations of the Organization for Economic Cooperation and Development (OECD), is generally considered a reliable indicator of international energy supplies. In a distinct change from its former reports, the IEA has suggested in its recent report that world governments need to make urgent revisions on energy-related policies if a global energy crisis is to be avoided.
According to the report, the reason for the IEA's warning is its anticipation that economic progress will increase global energy demands by about 50% in the next fifteen years. The majority of this demand is expected to come from China and India, which will be accountable for over 60 percent of carbon emissions, the chief reason for global warming, by 2030. Another reason stated for the IEA’s cautionary notice is that the number of oil suppliers is steadily decreasing. Since oil deposits in the North Sea region will soon be exhausted, countries supplying oil will be limited to those in the Gulf of Persia.
The government can address this imminent crisis through just one policy change. A team of Harvard analysts has predicted that if oil production is considerably expanded, oil prices could fall in the next decade. The team maintains that if previously under-utilized sources of oil are harnessed and more funding is provided for the setting up of new local refineries, the impending crisis could be avoided.
Which of the following best describes the author’s main purpose behind sharing the opinions of the team of Harvard analysts?
The poverty line, also known as the poverty threshold, is defined as the minimum level of income that is necessary for the people of a specific nation. The poverty line of a country is calculated by identifying the total amount of necessary expenses that an average adult requires over the course of one year, with the main such expense usually being house rent. Additionally, this calculation also typically includes the basic expenses of food and clothing. This measure of minimum income required is purely quantitative and does not estimate either the specific needs of people from different low-income groups or the different ways in which low-income groups experience poverty in different countries. The solely quantitative basis of calculating the minimum required income, therefore, may in fact lead to either the overestimation or the underestimation of the number of people who actually live under the poverty line in a given country. Another reason that renders the poverty line short of being a very reliable indicator of actual poverty levels is that certain nations, usually developed ones, with strong welfare systems fail to account for ‘in-kind’ transfers when calculating the poverty threshold. Such calculations do not regard the benefits received from antipoverty programs such as food stamps, housing assistance, etc. as income, thereby presenting a distorted picture of the level of poverty in the nation.
The primary purpose of the passage is to
The poverty line, also known as the poverty threshold, is defined as the minimum level of income that is necessary for the people of a specific nation. The poverty line of a country is calculated by identifying the total amount of necessary expenses that an average adult requires over the course of one year, with the main such expense usually being house rent. Additionally, this calculation also typically includes the basic expenses of food and clothing. This measure of minimum income required is purely quantitative and does not estimate either the specific needs of people from different low-income groups or the different ways in which low-income groups experience poverty in different countries. The solely quantitative basis of calculating the minimum required income, therefore, may in fact lead to either the overestimation or the underestimation of the number of people who actually live under the poverty line in a given country. Another reason that renders the poverty line short of being a very reliable indicator of actual poverty levels is that certain nations, usually developed ones, with strong welfare systems fail to account for ‘in-kind’ transfers when calculating the poverty threshold. Such calculations do not regard the benefits received from antipoverty programs such as food stamps, housing assistance, etc. as income, thereby presenting a distorted picture of the level of poverty in the nation.
Which of the following can be inferred from the last two sentences of the passage?
For once, the whys are turning out to be more important than the hows. A study shows that consumers who become fixated on how to achieve a goal probably face more difficulty in achieving their aims than people who think abstractly about why they want to do something. The authors of the study conducted four experiments to examine consumer behavior when it came to the goal of saving money. In one such experiment, some people were asked to make a specific plan to save money, whereas others were not asked to plan. Then some people were asked to focus on why they wanted to save money. Later on all participants were given the opportunity to buy candy. Subjects who were thinking concretely and formed a specific plan were less able to avoid the candy purchase than those who had not formed a plan at all.
To elucidate the results, the authors cite the instance of person who wants to save money and hence makes a plan for achieving this goal. This person plans to save money by purchasing fewer clothing items at the mall. On investigating how this plan influences the person's response to other money-saving opportunities, for example, would the person be more likely to order a cheaper meal at a restaurant, avoid making an impulse purchase, or combine errands to save money on gas etc., the authors found that when people focus on concrete aspects of how they want to achieve goals, they become more closed-minded and consequently less likely to take advantage of opportunities that fall outside their plans. In contrast, people who focus on the why aspect are more likely to consider out-of-plan opportunities to achieve their goals.
Furthermore, in the same experiment, the group that performed the best was the one that was asked to focus on the “why” and had formed a plan implicitly. Accordingly the authors conclude that planning is more effective when people plan with the complete understanding of “why”. They suggest that this strategy is particularly effective when the original plan turns out to be unrealistic in terms of feasibility or when other goal-directed activities become available.
The author is primarily concerned with
For once, the whys are turning out to be more important than the hows. A study shows that consumers who become fixated on how to achieve a goal probably face more difficulty in achieving their aims than people who think abstractly about why they want to do something. The authors of the study conducted four experiments to examine consumer behavior when it came to the goal of saving money. In one such experiment, some people were asked to make a specific plan to save money, whereas others were not asked to plan. Then some people were asked to focus on why they wanted to save money. Later on all participants were given the opportunity to buy candy. Subjects who were thinking concretely and formed a specific plan were less able to avoid the candy purchase than those who had not formed a plan at all.
To elucidate the results, the authors cite the instance of person who wants to save money and hence makes a plan for achieving this goal. This person plans to save money by purchasing fewer clothing items at the mall. On investigating how this plan influences the person's response to other money-saving opportunities, for example, would the person be more likely to order a cheaper meal at a restaurant, avoid making an impulse purchase, or combine errands to save money on gas etc., the authors found that when people focus on concrete aspects of how they want to achieve goals, they become more closed-minded and consequently less likely to take advantage of opportunities that fall outside their plans. In contrast, people who focus on the why aspect are more likely to consider out-of-plan opportunities to achieve their goals.
Furthermore, in the same experiment, the group that performed the best was the one that was asked to focus on the “why” and had formed a plan implicitly. Accordingly the authors conclude that planning is more effective when people plan with the complete understanding of “why”. They suggest that this strategy is particularly effective when the original plan turns out to be unrealistic in terms of feasibility or when other goal-directed activities become available.
Which of the following statement can be derived on the basis of the analysis done by the study authors?
For once, the whys are turning out to be more important than the hows. A study shows that consumers who become fixated on how to achieve a goal probably face more difficulty in achieving their aims than people who think abstractly about why they want to do something. The authors of the study conducted four experiments to examine consumer behavior when it came to the goal of saving money. In one such experiment, some people were asked to make a specific plan to save money, whereas others were not asked to plan. Then some people were asked to focus on why they wanted to save money. Later on all participants were given the opportunity to buy candy. Subjects who were thinking concretely and formed a specific plan were less able to avoid the candy purchase than those who had not formed a plan at all.
To elucidate the results, the authors cite the instance of person who wants to save money and hence makes a plan for achieving this goal. This person plans to save money by purchasing fewer clothing items at the mall. On investigating how this plan influences the person's response to other money-saving opportunities, for example, would the person be more likely to order a cheaper meal at a restaurant, avoid making an impulse purchase, or combine errands to save money on gas etc., the authors found that when people focus on concrete aspects of how they want to achieve goals, they become more closed-minded and consequently less likely to take advantage of opportunities that fall outside their plans. In contrast, people who focus on the why aspect are more likely to consider out-of-plan opportunities to achieve their goals.
Furthermore, in the same experiment, the group that performed the best was the one that was asked to focus on the “why” and had formed a plan implicitly. Accordingly the authors conclude that planning is more effective when people plan with the complete understanding of “why”. They suggest that this strategy is particularly effective when the original plan turns out to be unrealistic in terms of feasibility or when other goal-directed activities become available.
Through the second paragraph, the author of the passage intends to
For once, the whys are turning out to be more important than the hows. A study shows that consumers who become fixated on how to achieve a goal probably face more difficulty in achieving their aims than people who think abstractly about why they want to do something. The authors of the study conducted four experiments to examine consumer behavior when it came to the goal of saving money. In one such experiment, some people were asked to make a specific plan to save money, whereas others were not asked to plan. Then some people were asked to focus on why they wanted to save money. Later on all participants were given the opportunity to buy candy. Subjects who were thinking concretely and formed a specific plan were less able to avoid the candy purchase than those who had not formed a plan at all.
To elucidate the results, the authors cite the instance of person who wants to save money and hence makes a plan for achieving this goal. This person plans to save money by purchasing fewer clothing items at the mall. On investigating how this plan influences the person's response to other money-saving opportunities, for example, would the person be more likely to order a cheaper meal at a restaurant, avoid making an impulse purchase, or combine errands to save money on gas etc., the authors found that when people focus on concrete aspects of how they want to achieve goals, they become more closed-minded and consequently less likely to take advantage of opportunities that fall outside their plans. In contrast, people who focus on the why aspect are more likely to consider out-of-plan opportunities to achieve their goals.
Furthermore, in the same experiment, the group that performed the best was the one that was asked to focus on the “why” and had formed a plan implicitly. Accordingly the authors conclude that planning is more effective when people plan with the complete understanding of “why”. They suggest that this strategy is particularly effective when the original plan turns out to be unrealistic in terms of feasibility or when other goal-directed activities become available.
Each of the following is a statement that is mentioned with respect to the study described in the passage EXCEPT
For once, the whys are turning out to be more important than the hows. A study shows that consumers who become fixated on how to achieve a goal probably face more difficulty in achieving their aims than people who think abstractly about why they want to do something. The authors of the study conducted four experiments to examine consumer behavior when it came to the goal of saving money. In one such experiment, some people were asked to make a specific plan to save money, whereas others were not asked to plan. Then some people were asked to focus on why they wanted to save money. Later on all participants were given the opportunity to buy candy. Subjects who were thinking concretely and formed a specific plan were less able to avoid the candy purchase than those who had not formed a plan at all.
To elucidate the results, the authors cite the instance of person who wants to save money and hence makes a plan for achieving this goal. This person plans to save money by purchasing fewer clothing items at the mall. On investigating how this plan influences the person's response to other money-saving opportunities, for example, would the person be more likely to order a cheaper meal at a restaurant, avoid making an impulse purchase, or combine errands to save money on gas etc., the authors found that when people focus on concrete aspects of how they want to achieve goals, they become more closed-minded and consequently less likely to take advantage of opportunities that fall outside their plans. In contrast, people who focus on the why aspect are more likely to consider out-of-plan opportunities to achieve their goals.
Furthermore, in the same experiment, the group that performed the best was the one that was asked to focus on the “why” and had formed a plan implicitly. Accordingly the authors conclude that planning is more effective when people plan with the complete understanding of “why”. They suggest that this strategy is particularly effective when the original plan turns out to be unrealistic in terms of feasibility or when other goal-directed activities become available.
Which of the following is an example of a scenario in which the strategy suggested by the authors of the study in the last sentence of the passage would be most effective?
Irrespective of the general state of the economy, paying less for the same thing appeals to most consumers, who seem to have an intuitive dislike for inflation. But much as we may like to pay less, a sustained decline in prices, deflation, may not be in our best interests. Deflation, in fact, is considered to be a bigger evil than inflation, and evokes strong action by policymakers who would try everything possible to prop up prices. Deflation often results from a slowdown in which reduction in demand vis-à-vis supply causes prices to dip. With a sharp decline in prices, consumers tend to postpone purchases in the belief that prices will head further lower. This adds to the pressure on businesses, which in addition to a fall in prices also see an accumulation of inventory. Production cuts are hence resorted to, resulting in factory closures and consequent layoffs or salary cuts. With unemployment increasing, income levels in the economy fall, leading to further cuts in consumer spending and more pressure on prices. A vicious cycle emerges; the cascade effect is felt across sectors; and the economy goes into defeatist mode.
To prevent deflations and to tackle the downward spiral caused by them, governments resort to large-scale spending, undertaking massive projects to increase employment, incomes, and prices and pumping in huge sums of money to propel demand. For instance, in the aftermath of the financial market crash in 2008, the US government undertook big-ticket stimulus measures and QE (quantitative easing) to revive the economy.
However, not all dips in prices are bad. A fall in prices of goods and services due to technological innovations and increased competition could actually benefit both the consumers and the producers. Such a situation is very different from deflation, which affects prices across the economy on a sustained basis (mainly due to decreasing demand or liquidity problems) and which should indeed be considered a red flag.
Which of the following describes the function of the final paragraph?
Irrespective of the general state of the economy, paying less for the same thing appeals to most consumers, who seem to have an intuitive dislike for inflation. But much as we may like to pay less, a sustained decline in prices, deflation, may not be in our best interests. Deflation, in fact, is considered to be a bigger evil than inflation, and evokes strong action by policymakers who would try everything possible to prop up prices. Deflation often results from a slowdown in which reduction in demand vis-à-vis supply causes prices to dip. With a sharp decline in prices, consumers tend to postpone purchases in the belief that prices will head further lower. This adds to the pressure on businesses, which in addition to a fall in prices also see an accumulation of inventory. Production cuts are hence resorted to, resulting in factory closures and consequent layoffs or salary cuts. With unemployment increasing, income levels in the economy fall, leading to further cuts in consumer spending and more pressure on prices. A vicious cycle emerges; the cascade effect is felt across sectors; and the economy goes into defeatist mode.
To prevent deflations and to tackle the downward spiral caused by them, governments resort to large-scale spending, undertaking massive projects to increase employment, incomes, and prices and pumping in huge sums of money to propel demand. For instance, in the aftermath of the financial market crash in 2008, the US government undertook big-ticket stimulus measures and QE (quantitative easing) to revive the economy.
However, not all dips in prices are bad. A fall in prices of goods and services due to technological innovations and increased competition could actually benefit both the consumers and the producers. Such a situation is very different from deflation, which affects prices across the economy on a sustained basis (mainly due to decreasing demand or liquidity problems) and which should indeed be considered a red flag.
Which of the following statements would the author most likely agree with?
Irrespective of the general state of the economy, paying less for the same thing appeals to most consumers, who seem to have an intuitive dislike for inflation. But much as we may like to pay less, a sustained decline in prices, deflation, may not be in our best interests. Deflation, in fact, is considered to be a bigger evil than inflation, and evokes strong action by policymakers who would try everything possible to prop up prices. Deflation often results from a slowdown in which reduction in demand vis-à-vis supply causes prices to dip. With a sharp decline in prices, consumers tend to postpone purchases in the belief that prices will head further lower. This adds to the pressure on businesses, which in addition to a fall in prices also see an accumulation of inventory. Production cuts are hence resorted to, resulting in factory closures and consequent layoffs or salary cuts. With unemployment increasing, income levels in the economy fall, leading to further cuts in consumer spending and more pressure on prices. A vicious cycle emerges; the cascade effect is felt across sectors; and the economy goes into defeatist mode.
To prevent deflations and to tackle the downward spiral caused by them, governments resort to large-scale spending, undertaking massive projects to increase employment, incomes, and prices and pumping in huge sums of money to propel demand. For instance, in the aftermath of the financial market crash in 2008, the US government undertook big-ticket stimulus measures and QE (quantitative easing) to revive the economy.
However, not all dips in prices are bad. A fall in prices of goods and services due to technological innovations and increased competition could actually benefit both the consumers and the producers. Such a situation is very different from deflation, which affects prices across the economy on a sustained basis (mainly due to decreasing demand or liquidity problems) and which should indeed be considered a red flag.
As per the passage, which of the following would most likely be considered a dip in prices beneficial to both the consumer and the producer?
Irrespective of the general state of the economy, paying less for the same thing appeals to most consumers, who seem to have an intuitive dislike for inflation. But much as we may like to pay less, a sustained decline in prices, deflation, may not be in our best interests. Deflation, in fact, is considered to be a bigger evil than inflation, and evokes strong action by policymakers who would try everything possible to prop up prices. Deflation often results from a slowdown in which reduction in demand vis-à-vis supply causes prices to dip. With a sharp decline in prices, consumers tend to postpone purchases in the belief that prices will head further lower. This adds to the pressure on businesses, which in addition to a fall in prices also see an accumulation of inventory. Production cuts are hence resorted to, resulting in factory closures and consequent layoffs or salary cuts. With unemployment increasing, income levels in the economy fall, leading to further cuts in consumer spending and more pressure on prices. A vicious cycle emerges; the cascade effect is felt across sectors; and the economy goes into defeatist mode.
To prevent deflations and to tackle the downward spiral caused by them, governments resort to large-scale spending, undertaking massive projects to increase employment, incomes, and prices and pumping in huge sums of money to propel demand. For instance, in the aftermath of the financial market crash in 2008, the US government undertook big-ticket stimulus measures and QE (quantitative easing) to revive the economy.
However, not all dips in prices are bad. A fall in prices of goods and services due to technological innovations and increased competition could actually benefit both the consumers and the producers. Such a situation is very different from deflation, which affects prices across the economy on a sustained basis (mainly due to decreasing demand or liquidity problems) and which should indeed be considered a red flag.
Which of the following is mentioned in the passage?
The Grameen Bank, founded in Bangladesh by Nobel Peace Prize Laureate, Dr. Muhammad Yunus, who is also credited for giving life to the concept of microcredit/microfinance, is one of the most popular models of social business, a business that operates primarily for addressing social needs and not for-profit. Based on the concept of microfinance, Grameen provides microloans, small loans, to the poor and those living beyond the reach of traditional finance, in order to promote income generating activities, avoiding the more traditional form of poverty alleviation - aid donations. The original focus of the Grameen Bank was on rural people with no credit history and no collateral. However, the bank rapidly expanded, giving the illusion of a win-win situation that yielded both profits for Grameen Bank and huge improvements in development for Bangladesh. Private, for-profit organizations around the world wrongly judged the situation, thinking that they could first and foremost profit from this type of venture while developing the country in the process. This view was indeed tainted since Grameen’s goal was development and any profits were an added bonus. Because of these wrong expectations, the Grameen model has achieved limited success in countries other than those in South-East Asia, though the concept of microfinance has had better luck, with many countries now running profitable microfinance institutions that typically charge considerably higher interest rates for zero collateral loans than Grameen ever would.
Which of the following best captures the main idea of the passage?
The Grameen Bank, founded in Bangladesh by Nobel Peace Prize Laureate, Dr. Muhammad Yunus, who is also credited for giving life to the concept of microcredit/microfinance, is one of the most popular models of social business, a business that operates primarily for addressing social needs and not for-profit. Based on the concept of microfinance, Grameen provides microloans, small loans, to the poor and those living beyond the reach of traditional finance, in order to promote income generating activities, avoiding the more traditional form of poverty alleviation - aid donations. The original focus of the Grameen Bank was on rural people with no credit history and no collateral. However, the bank rapidly expanded, giving the illusion of a win-win situation that yielded both profits for Grameen Bank and huge improvements in development for Bangladesh. Private, for-profit organizations around the world wrongly judged the situation, thinking that they could first and foremost profit from this type of venture while developing the country in the process. This view was indeed tainted since Grameen’s goal was development and any profits were an added bonus. Because of these wrong expectations, the Grameen model has achieved limited success in countries other than those in South-East Asia, though the concept of microfinance has had better luck, with many countries now running profitable microfinance institutions that typically charge considerably higher interest rates for zero collateral loans than Grameen ever would.
Which one of the following statements can be inferred about the for-profit microfinance institutions?
The Grameen Bank, founded in Bangladesh by Nobel Peace Prize Laureate, Dr. Muhammad Yunus, who is also credited for giving life to the concept of microcredit/microfinance, is one of the most popular models of social business, a business that operates primarily for addressing social needs and not for-profit. Based on the concept of microfinance, Grameen provides microloans, small loans, to the poor and those living beyond the reach of traditional finance, in order to promote income generating activities, avoiding the more traditional form of poverty alleviation - aid donations. The original focus of the Grameen Bank was on rural people with no credit history and no collateral. However, the bank rapidly expanded, giving the illusion of a win-win situation that yielded both profits for Grameen Bank and huge improvements in development for Bangladesh. Private, for-profit organizations around the world wrongly judged the situation, thinking that they could first and foremost profit from this type of venture while developing the country in the process. This view was indeed tainted since Grameen’s goal was development and any profits were an added bonus. Because of these wrong expectations, the Grameen model has achieved limited success in countries other than those in South-East Asia, though the concept of microfinance has had better luck, with many countries now running profitable microfinance institutions that typically charge considerably higher interest rates for zero collateral loans than Grameen ever would.
According to the passage, which one of the following statements is true?
The poverty line, also known as the poverty threshold, is defined as the minimum level of income that is necessary for the people of a specific nation. The poverty line of a country is calculated by identifying the total amount of necessary expenses that an average adult requires over the course of one year, with the main such expense usually being house rent. Additionally, this calculation also typically includes the basic expenses of food and clothing. This measure of minimum income required is purely quantitative and does not estimate either the specific needs of people from different low-income groups or the different ways in which low-income groups experience poverty in different countries. The solely quantitative basis of calculating the minimum required income, therefore, may in fact lead to either the overestimation or the underestimation of the number of people who actually live under the poverty line in a given country. Another reason that renders the poverty line short of being a very reliable indicator of actual poverty levels is that certain nations, usually developed ones, with strong welfare systems fail to account for ‘in-kind’ transfers when calculating the poverty threshold. Such calculations do not regard the benefits received from antipoverty programs such as food stamps, housing assistance, etc. as income, thereby presenting a distorted picture of the level of poverty in the nation.
Which of the following is mentioned in the passage?
Should taxpayers pay to read the results of public funded research or do they have the right to those. This issue is the center of hotly contested debate in the House of Representatives as a part of the Research Works Act. The Research Works Act would forbid the National Institute of Health to require, as it now does, that its grantees provide copies of the papers they publish in peer-reviewed journals to the library. If the bill passes, to read the results of federally funded research, most Americans would have to buy access to individual articles at a cost of $15 or $30 apiece, making citizens pay for research already funded by them.
Publishers of journals such as Cell, Science, and The New England Journal of Medicine, who are backing the bill, argue that they add value to the finished product and that requiring them to provide free access to journal articles within a year of publication denies them their fair compensation and makes it difficult for them to generate profits comparable to the profits in the industry. Furthermore they claim that while the research may be publically funded, the journals are not, claiming that they add significant value in the peer review process that makes the published articles worthwhile.
But in fact, these journals receive billions of dollars in subscription payments, a good portion of their revenue today that is derived largely from public funds. Moreover, even the peer review process, which the journals claim is their primary value add, is funded by public funds. The researchers who volunteer their time to review their peers’ work come primarily from universities and research organizations that are funded by taxpayers’ dollars.
Rather than rolling back public access, Congress should move to enshrine a simple principle in United States law: if taxpayers paid for it, they own it. This is already the case for scientific papers published by researchers at the N.I.H. campus in Bethesda, Md., whose work has been explicitly excluded from copyright protection since 1976 because it was funded by public. It would be easy to extend this coverage to all works funded by the federal government.
The primary purpose of the passage is to
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