Reading Passage Question:

After the end of World War II, a pervasive, but unfortunately fallacious, economic perspective took hold. Based on the United States’ successful emergence from the Depression, the idea that war was good for an economy became fashionable. However, linking the United States economic recovery with its entry into World War II is a prime example of flawed economic thinking.

Supporters of the war benefits economy theory hold that a country at war is a country with a booming economy. Industry must produce weapons, supplies, food, and clothing for the troops. The increased production necessitates the hiring of more people, reducing unemployment. More employment means more money in the pockets of citizens, who are then likely to go out and spend that money, helping the retail sector of the economy. Retail shops experience an increase in business and may need to hire more workers, further reducing unemployment and adding to the economic momentum. While this scenario sounds good in theory, it does not accurately represent what truly happens in a war time economy.

In reality, the government can fund a war in a combination of three ways. It can raise taxes, cut spending on other areas, or increase the national debt. Each of these strategies has a negative impact on the economy. An increase in taxes takes money out of an individual’s hands, leading to a reduction in consumer spending. Clearly, there is no net benefit to the economy in that case. Cutting spending in other areas has its costs as well, even if they are not as obvious. Any reduction in government spending means the imposition of a greater burden on the benefactors of that government spending. Cutbacks in a particular program mean that the people who normally depend on that program now must spend more of their money to make up for the government cuts. This also takes money out of consumers’ hands and leaves the economy depressed. Of course, a government could go into debt during the war, but such a strategy simply means that at some point in the future, taxes must be increased or spending decreased. Plus, the interest on the debt must be paid as well.

‘After the end of World War II, a pervasive, but unfortunately fallacio’ is a GMAT reading comprehension passage with answers. Candidates need a strong knowledge of English GMAT reading comprehension.
This GMAT Reading Comprehension consists of 7 comprehension questions.
The GMAT Reading Comprehension questions are designed for the purpose of testing candidates’ abilities in understanding, analysing, and applying information or concepts. Candidates can actively prepare with the help of GMAT Reading Comprehension Practice Questions.

Questions and Solutions

1. The “pervasive…economic perspective” mentioned in line 1 took hold because

1. observers took the appearance of one phenomenon with another to indicate that one caused the other
2. the U.S. would not have emerged from the Depression had it not entered World War II
3. the booming economy during wartime created thousands of jobs in the U.S.
4. most people are not trained to think in economic terms
5. economists confused an event that was necessary for an outcome to occur with one that is merely sufficient to bring about that outcome

2. Which of the following situations best mirrors the effect that cutting spending in government programs has, as detailed in the passage?

1. Government cutbacks on public works maintenance lead to a deterioration of roads, which creates more work for private construction firms.
2. A decrease in the federal education budget causes certain schools to close, which forces families to send their children to schools that are farther away.
3. A federal decrease in unemployment payments causes some individuals who would otherwise remain on unemployment to seek jobs.
4. Government cuts in housing subsidies results in fewer houses being built.
5. A reduction in the federal spending on food safety inspections leads to a rash of illnesses and an increase in the amount of money spent on medicine.

3. The passage implies which of the following about a government that funds a war by increasing the national debt?

1. It is no worse off than it would be funding a war by cutting spending or increasing taxes.
2. The initial costs it incurs are less than with the other two methods, but the future costs are greater.
3. It must increase taxes in order to pay off the interest on the debt.
4. If the government does not increase taxes or decrease spending, its economy will not recover.
5. It receives a net benefit to the economy greater than it would achieve with either of the other two methods.

4. The second paragraph of the passage performs which of the following functions?

1. It describes the common economic benefits of a wartime economy.
2. It provides the background information necessary to understand the information in the third paragraph.
3. It explains what happened to the United States’ economy during World War II.
4. It presents a possible objection to the author’s main thesis.
5. It helps explain why individuals might hold the viewpoint presented in the first paragraph.

Suggested GMAT Reading Comprehension Questions

• Two Impressive Studies Have Reexamined Eric Williams’ Conclusion That Britain’s Abolition GMAT Reading Comprehension
• When Antonie Van Leeuwenhoek In 1675 First Discovered Bacteria GMAT Reading Comprehension
• Network Marketing Is A Business That Relies Heavily On Communication GMAT Reading Comprehension
• The Modern Mania For Psychological Testing Springs Directly From GMAT Reading Comprehension
• Cleopatra, Popularly Called The Queen Of Nile, Is Very Well Known GMAT Reading Comprehension
• In Ursula Leguins Short Story The Ones Who Walk Away From Omelas GMAT Reading Comprehension
• Polycystic Ovarian Syndrome, Or PCOS (Aka Stein-Leventhal Disease) GMAT Reading Comprehension
• For Ages Logic Has Served As An Introduction To Philosophy, That Is GMAT Reading Comprehension
• All the Perceptions of the Human Mind Resolve Themselves into Two Distinct GMAT Reading Comprehension
• As the Moorish States in all Parts of Spain Fell into Progressive Political GMAT Reading Comprehension
• Every Person is, at Times, Troubled by the Thoughts that their Beliefs GMAT Reading Comprehension
• Global Warming – Increase in Average Temperatures World-Wide – is a Problem GMAT Reading Comprehension
• If You Make a Marked Increase in the Amount of Light Falling Upon GMAT Reading Comprehension
• The Railroads Played a Key Role in the Settlement of the West GMAT Reading Comprehension
• A Growing Body of Research on Sharks and their Relatives Portrays GMAT Reading Comprehension
• Each Method of Counting Bacteria has Advantages and Disadvantages GMAT Reading Comprehension
• Most People Associate Bartering With Poor Or Undeveloped Societies GMAT Reading Comprehension
• The Fact That Bacteria Are Capable Of Chemical Communication GMAT Reading Comprehension
• The New Apple Watch 4 Offers A Built-In App With An Electrical Heart Rate Sensor GMAT Reading Comprehension
• Woodrow Wilson Won His First Office In 1910 GMAT Reading Comprehension
• A mysterious new material is surprising scientists with its ability to conduct electricity without resistance GMAT Reading Comprehension
• On the eve of New Year, almost every Japanese cleans his or her house. GMAT Reading Comprehension
• This year was horrible for many technology firms, but the last one was particularly dismal for Microsoft GMAT Reading Comprehension
• In the eighth century, cities in the southern Mayan lowlands began to decline, and were soon abandoned. GMAT Reading Comprehension
• Over the past century, the United States population has continued to grow GMAT Reading Comprehension
• Mitochondrial DNA from both ancient and modern chicken specimens may provide evidence GMAT Reading Comprehension
• It is perhaps not surprising that debate has arisen over bioluminescence-based biotechnologies GMAT Reading Comprehension
• During the twelfth century, the Indian author Bhaskara published a drawing of a wheel GMAT Reading Comprehension
• A supernova is a brief stellar explosion so luminous that it can briefly outshine an entire galaxy GMAT Reading Comprehension
• The largest part of the brain, which is what you actually see when you look at a brain from above or the side GMAT Reading Comprehension
• James Joyce revolutionized the novel, the short story, and modern literature as we know it. GMAT Reading Comprehension
• ”Proverbial wisdom states that “birds of a feather flock together.”GMAT Reading Comprehension
• VO2 max is more than merely a trendy buzzword for workout aficionados to bandy about GMAT Reading Comprehension
• What does laughter mean? GMAT Reading Comprehension
• The sloth bear, an insect-eating animal native to Nepal, GMAT Reading Comprehension
• Homing pigeons can be taken from their lofts and transported hundreds of kilometers in covered cages GMAT Reading Comprehension
• The ultimate pendulum clock, indeed the ultimate mechanical clock of any kind GMAT Reading Comprehension
• Structural unemployment—the unemployment that remains even at the peak of the economy’s upswings GMAT Reading Comprehension
• The most common metal in the Earth’s crust, aluminum (or aluminium) was not discovered until 1825 GMAT Reading Comprehension
• In response to a recent survey conducted by a newspaper in Quantos city. GMAT Reading Comprehension
• The pioneers of the teaching of science imagined that its introduction GMAT Reading Comprehension
• The Internet Is A System Of Computer Networks That Allows Individuals GMAT Reading Comprehension
• Visual Recognition Involves Storing And Retrieving Memories GMAT Reading Comprehension
• Many politicians, business leaders, and scholars discount the role GMAT Reading Comprehension
• The Transfer of Heat and Water Vapor from the Ocean to the Air Above GMAT Reading Comprehension
• Frogs react quickly and effectively to bugs that fly past them GMAT Reading Comprehension
• The English spoken across the Atlantic nevertheless began to receive GMAT Reading Comprehension
• Sound travels through the air in waves from a central source much as GMAT Reading Comprehension
• It Is Paradoxical That The Old Countries Involve Themselves GMAT Reading Comprehension
• David Packard, Co-Founder Of Hewlett-Packard GMAT Reading Comprehension