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GRE Sample Questions

Verbal Section : Reading Comprehension

Read the following comprehension and answer the following question.

  1. The budget for 1993-1994 has set the stage for a greater inflow of resources into the farm sector. A part from errant monsoons, one reason why this sector has remained sluggish in recent years is the trend of falling investments in agriculture. At a time when shortage of cultivable land means that growth has to come mainly through increases in productivity, the pace of investment is crucial to raising farm production. During the eighties, while public investment has fallen in real terms, private investment has remained stagnant. Since agriculture is a state subject, the fall in public investment reflects the dwindling ability of state government to find more resources. Therefore while central budget cannot do much to stimulate public investment in the farm sector, it can surely create condition for increased investment by farmers themselves. And this is precisely what the latest budget seeks to do. Since then brought year of 1987 to 88, the tardy pace of credit flow to agriculture has affected investment. By promising a 20% increase in institutional credit to farmers during the coming year, the budget expects that term loans for minor irrigation will help sink 3.70 lakh wells and install more as the cuts in customs duties on farm machinery will now make it cheaper.

    In fact, the reductions in customs tariffs have the potential of generating more investible resources for farmers. This is because high rates of tariff protection hitherto accorded to Indian industry have allowed the latter to sell industrial goods to farmers at much higher prices than those at which they are sold internationally. Indirectly, high customs duties have thus imposed a tax on farmers and transferred resources away from rural areas to the industrial sectors. The latest budget takes the correct initiative to arrest this trend. It is true that the government policy of raising administered prices to reduce subsidies will raise the prices of inputs like power, fertilizer and diesel use in farm operation. However apart from the usually simultaneous and compensatory increase in procurement prices, farmers stand to gain the most through in increase in public investment made possibly by reduction in subsides. The central budget has shown that subsidy reduction mean more plan investment. If the state government can follow this example, than a package comprising cuts in customs tariffs, increases in public investments and higher credit flows to formers, holds the potential or revalorizing Indian agriculture.

    1. Which of the following statements is true in the context of the passage?
      1. Since 1987-88 government as provided substantial credit to agricultural sector
      2. There is a steady increase in cultivable land over the years
      3. During the eighties public investment had increased in real terms
      4. Monsoon has been regular and timely in the recent years
      5. The budget for 1993-94 has been favorable for Indian agriculture

      Ans : E

    2. According to the passage what will be the effect of government’s policy of raising administered prices to reduce subsidies
      1. It will raise the prices of important inputs used in farm sectors
      2. It will reduce the procurement prices of farm products
      3. It will divert flow of resources from industrial sector to farm sector
      4. It will automatically result in reduction of custom tariffs
      5. None of the above

      Ans : A

    3. Reduction in customs tariffs will result in generation of more resources for farmers because
      1. More and more term loan will be available to them
      2. State government will come forward to provide them with credit facilities
      3. They will get higher prices for their products
      4. They will get industrial goods at much lower prices
      5. They will divert resources from farm sectors to industrial sector

      Ans : D

    4. Which of the following statements is not true in the context of the passage?
      1. High custom duty resulted in transforming resources away from rural areas to industrial sector
      2. So far Indian industry had low rate of tariff protection
      3. Central budget can create favorable conditions for increased in vestments
      4. Reduction in customs tariffs can help generate more resources
      5. During eighties private investments had remained stagnant

      Ans : B

    5. Which of the following is most nearly the same in meaning as the word ERRANT as used in the
      1. Unblemished
      2. Circuitous
      3. Erroneous
      4. Deviating
      5. Deviating

      Ans : D

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    GRE Sample Reading Comprehension Passage Number : 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19
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