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Complete the Passage

Directions: In each of the following questions a short passage is given with one of the lines in the passage missing and represented by a blank. Select the best out of the five answer choices given, to make the passage complete and coherent.

1. The fiscal position of the Indian Governments - both Centre and States -has been under stress since the mid - 1980s. The stress stems from the inadequacy of receipts in meeting the growing expenditure requirements. Reflecting the fiscal stress, the expenditure for development activities, which are directly related to growth, has suffered. On other hand expenditure on non-developmental purposes, largely committed, has witnessed a steady rise in favor of developmental expenditure in order to enable higher growth. That the state of finances of States is in disarray is beyond dispute. The state finances have not been properly managed not only by the states but also by the planning commission and the central Government, which include economists who do not see states as autonomous responsible organizations.

(1) The crucial issue, therefore, is to bring about improvement in the finances with a view to restructuring expenditure
(2) The crucial issue, therefore, is to analyze the finances with a view to see what can be done to expenditure
(3) Hence, it can be said that management of finances is important vis-a-vis management of expenditures
(4) Therefore, Governments have to mend their way and balance the finances and the expenditures
(5) What is expected in this scenario is a policy shift

2. In the planned economy of India, foreign capital has been assigned a significant role, although it has been changing over the time. In the earlier phase of planning many concessions and incentives were given to foreign investors. Later on, however, the emphasis shifted to encouraging technological collaboration between Indian Entrepreneurs and foreign entrepreneurs. In more recent times, efforts are on invite free flow of foreign capital. It would be instructive in this background to examine the Government's policy towards foreign capital.
(1) Foreign capital was looked upon as a means to supplement domestic investment
(2) Foreign capital was seen as threat to Indian entrepreneurs
(3) Foreign capital was not expected to come in so much huge amount
(4) Foreign capital was infused to stabilize the Indian economy
(5) Foreign capital was the only way out for the economy in crippling state

3. The thirteen Finance commissions cover a span of more than 60 years during which many conditions have changed. Correspondingly, the approach of the later commissions may be expected to be different in several respects from the earlier ones which have come to evolve gradually what may be called 'the Indian Finance Commission's approach to federal finance. There are several inadequacies in the approach of the Finance Commissions. According to this approach, States' share of Central taxes is not allocated strictly on the basis of need.
(1) Nevertheless, it is possible to discern certain common elements in the thinking of the successive Finance Commissions
(2) And it happened to be in that way
(3) Evolution is a long process and it is a same story for commissions
(4) But they differ completely from them and each time new approach was looked for
(5) This was based on the tax sharing basis principle of commissions

4. Under taxation is at the roots of the Indian fiscal problems. The available evidence shows that the tax –GDP ratio in India is lower than the level it should have for its per capita GDP by at least 2.5 percent. It is, therefore important to focus reform efforts to increase the tax ratio. Of course, this does not mean that strategy to increase the tax ratio lies in increasing the tax rates. The strategy is to reiterate that tax administration is tax policy. All exemptions will not go. Politically, it is not possible. The world over, there was a time when we thought that equity in tax policy meant reducing the incomes of the rich. But today's tax philosophy is that equity in tax policy is increasing the incomes of the poor. The incomes of the poor cannot be increased by reducing those of the rich.
(1) As they are the central point of any economy their importance is preemptory
(2) As they have the real remote control in their hands and poor cannot see that.
(3) As they have the capital for investment and give employment to the poor.
(4) As they have lobbying power to decide the fate of the poor.
(5) As they are capital rich and cannot be compared with poor.

5.....................Enterprises worldwide are therefore, now putting in place an integrated framework for risk management which is proactive, systematic and covers the entire organization. Banks in India are also moving from the individual silo system to an enterprise -wide risk management system. This is placing greater demands on the risk management skills in banks and has brought to the fore the need for capacity building. While the first mile-stone would be risk integration across the entity, banks would do well to aggregate risk across the group both in the specific risk areas as also across the risks.
(1) Banks are most risk prone of all the financial institutions.
(2) Banks were managing each risk independently, in isolation, which is no longer inadequate
(3) It is about risk level at which an enterprise is operating to have or not have risk management system
(4) Risk management in India is lagging for banks in comparison with other parts of world
(5) What, if risk becomes unmanageable and looks right in your face..?

1. 1) Passage can be divided in two parts. First part (before the blank) is about the growing expenditure and its subsequent pressure as felt by the governments. Second part is (after the blank) is about the finances and their mishandling by governments. This blank portion should be filled with something that gives some solution to the issue of growing expenditure and provides a beginning platform to discuss /raise the issue of finances. So option (a) is best answer. Option (e) can be rejected out rightly as it has no substantial information. Option (b) & (c) are conclusive statements about finances and are not about expenditures. Option (d) again can end the passage but cannot be put in the blank.

2. 1) Read the sentence after the blank space. 'Many concessions and incentives ' If foreign investment was seen as threat to Indian business then definitely Government would not provide incentives. On this logic, Option (b) can be rejected. Indian economy needs stabilization or not; is not discussed in passage. Hence option (d) is also not right. In option (e) word only is questionable. Option (e) can also be skipped. Option (c)'s statement can be a result of incentives but not preceding this measure. Option (a) is appropriate as seems logical that initially to supplement Indian economy, foreign capital was looked upon and hence some incentives were given to the foreign investors.

3. 1) Tax sharing is discussed in the end only so Option (e) is not proper for the blank provided. Option (d) says complete diversion of previous and new commission's approach but the following sentence has word gradually in it and hence contradiction arises. Option (b) is not substantive enough and does not elaborate the matter which is required in the context. Option (c) is generic in nature which is also not appropriate for the blank. Option (a) is best one as it goes with flow of the passage and sentence following the blank validates it.

4. 3) Option (a) is very capitalistic in nature and can be an individualistic thought but not the truth or the correct option for closing the passage. Option (b) is also not hinted at in the passage and cannot be inferred from the passage. Option (d) is almost similar to statement in option (a) and is incorrect choice. The passage is about equity in tax for rich and poor not about the rich -poor relationship. Option (e) is out of context. Option (c) gives logical and coherent ending to the passage justifying the preceding statement.

5.3) It is a statement which deals with enterprises, which is carried forward in the second sentence of the paragraph. The remaining statements deal with banks, which come in the third sentence onwards.

Assignment -2
Directions (1-5): Choose the option which completes the blank part of the passage in coherent and logical manner.
1. In the planned economy of India, foreign capital has been assigned a significant role, although importance has been changing over time. In the earlier phase of planning, foreign capital was looked upon as a means to supplement domestic investment. Many concession and incentives were given to foreign investors. Later on, however, the emphasis shifted to encouraging technological collaboration between India entrepreneurs and foreign entrepreneurs. In more recent times, efforts are on to invite free flow of foreign capital................
(1) Foreign Policy of the Government is conducive to it.
(2) Let us see what fruits these efforts would bring after 20 years or something.
(3)Importance of foreign capital will keep changing.
(4) It would be instructive in this background to examine the Government's policy towards foreign capital.
(5) Capital infusion is the need of hour not about the foreign investments.

2. The country is passing through major economic and political changes and, as a reaction to over centralization can in the past decades, beside, the current policy of decentralizing economic decision making through liberalization can aggravate regional disparities and here the Center has an important role to play. At the same time, ______ the less developed States will have to make corrections in their policies to attract investment, otherwise there are going to be more disparities.
(1) The States have been asking for greater freedom in the exercise of economic powers
(2) The states are not cooperating the central government
(3) The states are defying the central government's policies
(4) Policy correction is the demand from the states
(5) Centralization has brought colorful results

3. A substantial part of the transfers in second category are by say of assistance for the execution of the state plans. If to these transfers are added those on account of central and centrally sponsored plan-scheme, the totality of the plan transfers works out to about 4 0per cent of the total transfers. The central assistance for the plans is based on the recommendations of the Planning Commission. It includes loans and grants India is founder-member of the WTO. India has contributed significantly to the evolution of the concept of the WTO. In turn, India is already reaping in a big way various benefits that can be directly or indirectly associated with the WTO.___________
(1) Hence role of WTO is crucial in South Asia of which India is a part.
(2) Hence role of WTO is crucial in development of India
(3) Hence role of WTO is crucial only in some areas of India
(4) Hence role of WTO cannot be overruled.
(5) Hence India is having a give and take relation with India

4. India is experiencing an unprecedented boom in exports, as are the world exports. India is soon to reach the export target of $100 billion, up from only $33.22 billion in 1998-99.This can be attributed, in a large measure-
  • To the WTO-induced lowering of the trade barriers.
  • India has immensely benefited from the multilateral dispute settlement system that has been set up under the WTO. Action has been initiated against such powerful economies as the USA n disputes involving India.
  • Adoption of international standards in Intellectual Property Rights protection would enhance flow of foreign investment and technology.
  • Indian laboratories engaged in research in plant varieties and seeds for tropical regions would benefit.

(1) Allocation for safety and armed forces were increased in last year's budget
(2) Allocation of funds to school education particularly in primary level and good implementation thereof.
(3)Indian delegation better represented its cause in the SAARC meetings held over the year.
(4) An environment for growth was created and sense of confidence in Indian markets was imbibed.
(5) Industrialist gain confidence with the substantial cut in the taxes both indirect and direct.

5. FDI may actually be harmful to the recipient country if the economy is highly protected and foreign investment takes place behind high tariff walls. This type of investment is generally referred to as the tariff jumping variety of foreign investment, whose primary objective is to take advantage of the protected markets in the host country. The longer the Government shields its home market with tariffs... and more acute will be the conflict between him and the domestic entrepreneur, in view of this, an appropriate policy framework must respond to two conflicting objective: the need to liberalizes rules governing such investment in view of the growing integration of the world economy, and the need to ensure that such investment has positive effects on the country's economy and does not lead to negative welfare effects.
(1) The more will the foreigner come in to exploit that protected market
(2) The more will the resentment in foreign countries
(3) The more will the liberalization demand and more will the decontrolling
(4) The more will the foreign investment to come in
(5) The more will the foreign interruption be

Directions (6-8): In each of the following questions a short passage is given with one of the lines in the passage missing and represented by a blank. Select the best out of the five answer choices given, to make the passage complete and coherent.
6. The biggest attraction of the public sector is that, for women with the same qualifications and skills it almost always pays better than does private industry. For men the differences are much less pronounced........................ Figures are hard to come by, but in rich countries women typically hold 30-40% of senior managerial posts in central government. Hours and conditions too are usually more congenital and maternity arrangements more generous .So with better pay, conditions and promotion prospects, it is no wonder that the public sector is the employer of the choice for so many women.
(1) The public sector is also more likely to promote women to senior jobs
(2) The public sector provide safe working environment for the women.
(3) Women are paid more than men in public sector
(4) Public sector is better pay master than private banks for women
(5) There is no issue in making a choice for women

7. But no depreciation is allowed on Live Stock i.e. Horses .Although the horses are in the nature of fixed assets in the hands of the owner, no depreciation is allowed under Income Tax Act. Instead when the animal dies or becomes permanently useless the entire value of the horse can be written off as revenue loss in the year in which it dies or becomes permanently useless. When the gross income exceeds the total expenditure, it results in net profit which will be taxable at usual rates of tax applicable to the person. But when the gross income is less than the expenditure, then results in loss. Although the live stock is in the nature of fixed assets of the owners buy them, maintain them, train them, and participate in races and.........
(1) Sell them or send them away to studs when they are useless.
(2) Adore them for they are their best friends and compensate for the love of near ones
(3) Make show them as fixed assets in their balance sheets
(4) Shot them when they become useless
(5) Occasionally use them for transportation purposes

8. Aggregation of risks is somewhat quite new to banks in India. While some banks have started thinking in that line by trying to put integrated limits framework and integrated risk policies as well as using CBS solutions for technological integration, the effort required is beyond such requirement. Risk aggregation would mean aggregating the individual risk measures to decide most appropriate assets class that would contain the risk to the desired level dictated by the risk appetite .Capital allocation (about how much) would be based on such strategies...........
(1) Most banks are yet to conceptualize the same in their processes
(2) Most banks have already integrated it in their functioning; it is working over the years satisfactorily.
(3) Which would in long run prove to be the growth impeding.
(4) Of risk aggregation which is really a new concept to Indian banks
(5) On expected lines of the regulation conditions laid down in the manual of the bank

9. Moreover, the interface between the citizen and the instrumentalities of the government - the police force, the judiciary, the ration inspector, the RTO, the sub-registrar, the tehsildar, the taxman, the municipal inspector - has been largely unaffected by the forces of reform. Successive governments continue to allocate increasingly larger resources to anti-poverty programmes that account for a large part of the federal and state budgets. There is, however, no evidence to suggest any improvement on the old benchmark of 15 paisa / rupee of welfare allocation finally reaches the intended beneficiary. The day may not be far off when policy makers are held squarely responsible for the continuing endemic poverty, given that the means to eradicate it are very much at hand. The best way to improve the quality of public services is to provide access to more information so that the citizens are aware of the basis of decision making In government. The work culture has degenerated into one of survival without decision-making since this is the sure path to not being found guilty of wrong doing and hence the clear route to career progression. Scientific and Technical Departments are not exceptional too......................
(1) It is expected that the Right To Information (RTI) Act 2005 will provide necessary scope and hope to reverse the trend, and usher in "SMART" Government
(2) It is sure that the Right to Information (RTI) Act, 2005 will prove to be panacea for these problems and would guide 'SMART' Government
(3) Right to Information (RTI) Act, 2005 would definitely change the relationship of common men with the junior level officers working in their locality
(4) Right to Information (RTI) Act, 2005 is a possibility in next session of the parliament with a view to solve all above problems
(5) Right to Information (RTI) act ,2005 would be a tool in hands of common men to fight corruption at their level

10. Analyses of long-term data show that there has been significant reduction in poverty in all major states of India during 1990-2010. The depth and intensity of poverty have fallen at a faster rate than the head count ratio. In recent years, poverty seems to be getting concentrated in Eastern and Central parts of India and among the Scheduled Tribes and Scheduled Caste population...................... Mean consumption expenditure show significant rise in rural and urban areas of all major states except rural Assam. Inequality too has fallen in rural areas of most states, though urban inequality in most states has not changed significantly. The urban-rural disparity in mean consumption has accentuated since early 1990s. Incidence of under nutrition and malnutrition in India is higher than incidence of income poverty. Micronutrient deficiency of one form or another seems to be common among a large section of the population. India lags behind in terms of human development indicators such as achievements in education and health fields in international comparison even poverty reduction figures are not encouraging.
(1) This is quite evident in the Human Development indicators
(2) Human Development figure are still not encouraging in comparison with international community
(3) How they calculate the Human Development numbers is quite confusing for the Indian Development?
(4) However, Human development figures do not reflect it
(5) However improvement is negligible in comparison with other countries as evident from Human development indicators

11. Among economists and people who work in finance it seems to be almost reflexive to dismiss anyone who says "this time is different." I think that makes sense where we're dealing with things like human behavior or market psychology. If you're talking about asset bubbles, for example, then it's most likely true: things will NEVER be different. But I question whether you can apply that to a technological issue. With technology things are ALWAYS different. Impossible things suddenly become possible all the time; that's the way technology works and..The second question is whether economists have really studied this issue at length—and by that I mean specifically the potential impact of accelerating technical progress on the worker-machine relationship. 1 could not find much evidence of such work. In honesty, I did not do a comprehensive search of the literature, so it's certainly possible I missed a lot of existing research, and I invite any interested economists to point this out in the comments.
(1) It seems to me that the question of whether machines will someday out-compete the average worker is primarily a technological, not an economic question
(2) It seems that machines will never be able to outcompete with the men as they have no brains and controls after all is in human hands
(3) It is question of time for me when the technology will outpace the human workforce and make a niche for it in future
(4) It is not certain for me whether the machines will ever be able to out compete the man
(5) Man -machine relationship is entering a new arena of competition and it is quite interesting for me

12......................... Having upper level management on board is a key component to effectively implement these ideas. Managers are the people that have to be ready to assist in making sure these ideas come to fruition. Management must be ready and willing to have fun and they need to be whimsical in order to implement these ideas. It means a lot to staff when their supervisors really are behind the implementation of these"thank you" for staff.
Some of the ideas may include but are, of course, not limited to:
  • Get all upper level managers to have a pancake breakfast for staff. This is the perfect opportunity to involve managers in the fun. They can bring out their skillets, put on their chef hats and make pancakes for staff.
  • Organize a potluck luncheon for staff, where each person brings a dish for everyone to eat. You can complete this event with games and even a theme. Inexpensive items can be purchased for raffle or prizes.
  • Set up a mini-golf course, or mini bowling in the halls of the office. Provide music and snacks for a mid afternoon break.
  • Create fun drinks and call them 'mock tails' (i.e., root beer floats, passion fruit punch, etc.); use a cart and go office to office, cubicle to cubicle and serve staff refreshment in the middle of an afternoon.

(1) Opportunities are galore and attrition rate would ever increase without some creative thinking from the managers down the line.
(2) Employee has become the focal point of management's approach to tackle inefficiency and low productivity
(3)What is wrong with management for involvement in amusements at office rather than working on core activities?
(4) Now is the time when we must think outside the box and brainstorm for simple, inexpensive ways to show appreciation to our staff.
(5)Employee motivation needs total rejuvenation of employees thinking and attitude for the organization and management decisions














6. (1) immediately after the blank there is mention of senior managerial posts and just before the blank a difference in Private and Public sector for women has been discussed. So it can be said that in blank space something mentioning or connecting both these issues with reference to less pronounced results for men should be used. Other options are true but in parts only. So can be overruled for Option (1).
7. (1) Sentence before the blank space is just the life of horses as livestock in the hands of owners and proper sequence will be buying, maintaining, training, utilizing for racing and then selling them when they become useless. Shot them after racing does not make sense. Balanced sheets are not suitable sequence. Option (5) seems to be illogical for a person having racing horse.
8. (5) Option (b) is out of place as the passage starts with almost opposite information as given in this. Option (3) is against the spirit of the passage. Option (4) repeats only what has been said already in the passage. Option (1) can be inferred from the passage but it cannot be the final closing sentence. So option (5) is right choice after considering all the options and it completes the passage in right manner.
9. (1) Option (2) is wrong as it expresses sure success for the RTI which cannot be ascertained from the passage. Option (4) is also wrong on this reason. Option (5) is wrong because structure of RTI cannot be reached at from the option whether it would be in hand s of the common men or not. Option (c) defines the scope of RTI which cannot be inferred from the passage. Only option which is right is Option (1) as it expresses only expectation from RTI with sufficient scope to reverse the trend given in passage.

10.(2) Option (1) contradicts the last part of passage. Option(3) is out of context as methodology of calculation of HDI is not being discussed here. Option (4) is doubtful if there is improvement then it should be there in HDI Option (5) is too deep in comparison and 'negligibility' of this option is refuted by Tagging behind' of last part of passage. When you lag behind someone you do not show negligible improvement in comparison to others. Option (2) is right in its approach and place of blank space as it is elaborated in latter parts of passage.

11.(1)Part of passage before discusses technology and economics with a difference and part of passage after the blank space discusses the relation of men with machine. Option (1) has elements of both in it and hence connects well with two. Other options are not able to connect these two parts with special reference to matter of both.

12. (3) Some of the unorthodox and out of box methods to increase employee involvement are given in passage and option (3) gives us logic for that. Inefficiencies and low productivity is not discussed here. Methods given are not about employee thinking but about the management's thinking. Option (3) goes against the spirit of passage.
Prepared by,
IACE, Hyderabad.
Published date : 13 Jun 2015 11:27AM

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