IBPS PO – IBPS PO TEST - 12

Read the following passage carefully and answer the questions given below it. Certain words have been printed in bold to help you locate them while answering some of the questions. <br><br> Most economists in the United States seem <strong>captivated</strong> by the spell of the free market. Consequently, nothing seems good or normal that does not accord with the requirements of the free market. A price that is determined by the seller or, for that matter (for that matter: so far as that is concerned), established by anyone other than the aggregate of consumers seems <strong>pernicious</strong>. Accordingly, it requires a major act of will to think of price­fixing (the determination of prices by the seller) as both "normal" and having a valuable economic function. In fact, price­fixing is normal in all industrialized societies because the industrial system itself provides, as an effortless consequence of its own development, the price­fixing that it requires. Modern industrial planning requires and rewards great size. Hence, a comparatively small number of large firms will be competing for the same group of consumers. That each large firm will act with consideration of its own needs and thus avoid selling its products for more than its competitors charge is commonly recognized by advocates of free­market economic theories. But each large firm will also act with full consideration of the needs that it has in common with the other large firms competing for the same customers. Each large firm will thus avoid significant price­cutting, because price­cutting would be <strong>prejudicial</strong> to the common interest in a stable demand for products. Most economists do not see price­ fixing when it occurs because they expect it to be brought about by a number of explicit agreements among large firms; it is not. <br><br> Moreover, those economists who argue that allowing the free market to operate without interference is the most efficient method of establishing prices have not considered the economies of non­socialist countries other than the United states. These economies employ intentional price­fixing, usually in an <strong>overt</strong> fashion. Formal price­fixing by <strong>cartel</strong> and informal price­fixing by agreements covering the members of an industry are commonplace. Were there something peculiarly efficient about the free market and inefficient about price­fixing, the countries that have avoided the first and used the second would have suffered drastically in their economic development. There is no indication that they have. <br><br> Socialist industry also works within a framework of controlled prices. In the early 1970's, the Soviet Union began to give firms and industries some of the flexibility in adjusting prices that a more informal evolution has accorded the capitalist system. Economists in the United States have hailed the change as a return to the free market. But Soviet firms are no more subject to prices established by a free market over which they exercise little influence than are capitalist firms; rather, Soviet firms have been given the power to fix prices.

The primary purpose of the passage is to

Read the following passage carefully and answer the questions given below it. Certain words have been printed in bold to help you locate them while answering some of the questions. <br><br> Most economists in the United States seem <strong>captivated</strong> by the spell of the free market. Consequently, nothing seems good or normal that does not accord with the requirements of the free market. A price that is determined by the seller or, for that matter (for that matter: so far as that is concerned), established by anyone other than the aggregate of consumers seems <strong>pernicious</strong>. Accordingly, it requires a major act of will to think of price­fixing (the determination of prices by the seller) as both "normal" and having a valuable economic function. In fact, price­fixing is normal in all industrialized societies because the industrial system itself provides, as an effortless consequence of its own development, the price­fixing that it requires. Modern industrial planning requires and rewards great size. Hence, a comparatively small number of large firms will be competing for the same group of consumers. That each large firm will act with consideration of its own needs and thus avoid selling its products for more than its competitors charge is commonly recognized by advocates of free­market economic theories. But each large firm will also act with full consideration of the needs that it has in common with the other large firms competing for the same customers. Each large firm will thus avoid significant price­cutting, because price­cutting would be <strong>prejudicial</strong> to the common interest in a stable demand for products. Most economists do not see price­ fixing when it occurs because they expect it to be brought about by a number of explicit agreements among large firms; it is not. <br><br> Moreover, those economists who argue that allowing the free market to operate without interference is the most efficient method of establishing prices have not considered the economies of non­socialist countries other than the United states. These economies employ intentional price­fixing, usually in an <strong>overt</strong> fashion. Formal price­fixing by <strong>cartel</strong> and informal price­fixing by agreements covering the members of an industry are commonplace. Were there something peculiarly efficient about the free market and inefficient about price­fixing, the countries that have avoided the first and used the second would have suffered drastically in their economic development. There is no indication that they have. <br><br> Socialist industry also works within a framework of controlled prices. In the early 1970's, the Soviet Union began to give firms and industries some of the flexibility in adjusting prices that a more informal evolution has accorded the capitalist system. Economists in the United States have hailed the change as a return to the free market. But Soviet firms are no more subject to prices established by a free market over which they exercise little influence than are capitalist firms; rather, Soviet firms have been given the power to fix prices.

The passage provides information that would answer which of the following questions about price­fixing?<br><br> I. What are some of the ways in which prices can be fixed? <br> II. For what products is price­fixing likely to be more profitable that the operation of the free market? <br> III. Is price­fixing more common in socialist industrialized societies or in non­socialist industrialized societies?

Read the following passage carefully and answer the questions given below it. Certain words have been printed in bold to help you locate them while answering some of the questions. <br><br> Most economists in the United States seem <strong>captivated</strong> by the spell of the free market. Consequently, nothing seems good or normal that does not accord with the requirements of the free market. A price that is determined by the seller or, for that matter (for that matter: so far as that is concerned), established by anyone other than the aggregate of consumers seems <strong>pernicious</strong>. Accordingly, it requires a major act of will to think of price­fixing (the determination of prices by the seller) as both "normal" and having a valuable economic function. In fact, price­fixing is normal in all industrialized societies because the industrial system itself provides, as an effortless consequence of its own development, the price­fixing that it requires. Modern industrial planning requires and rewards great size. Hence, a comparatively small number of large firms will be competing for the same group of consumers. That each large firm will act with consideration of its own needs and thus avoid selling its products for more than its competitors charge is commonly recognized by advocates of free­market economic theories. But each large firm will also act with full consideration of the needs that it has in common with the other large firms competing for the same customers. Each large firm will thus avoid significant price­cutting, because price­cutting would be <strong>prejudicial</strong> to the common interest in a stable demand for products. Most economists do not see price­ fixing when it occurs because they expect it to be brought about by a number of explicit agreements among large firms; it is not. <br><br> Moreover, those economists who argue that allowing the free market to operate without interference is the most efficient method of establishing prices have not considered the economies of non­socialist countries other than the United states. These economies employ intentional price­fixing, usually in an <strong>overt</strong> fashion. Formal price­fixing by <strong>cartel</strong> and informal price­fixing by agreements covering the members of an industry are commonplace. Were there something peculiarly efficient about the free market and inefficient about price­fixing, the countries that have avoided the first and used the second would have suffered drastically in their economic development. There is no indication that they have. <br><br> Socialist industry also works within a framework of controlled prices. In the early 1970's, the Soviet Union began to give firms and industries some of the flexibility in adjusting prices that a more informal evolution has accorded the capitalist system. Economists in the United States have hailed the change as a return to the free market. But Soviet firms are no more subject to prices established by a free market over which they exercise little influence than are capitalist firms; rather, Soviet firms have been given the power to fix prices.

The author's attitude toward "Most economists in the United States" can best be described as