Q.1-10. Read the following passage carefully and answer the
questions given below it certain words are given in bold to help you locate
them while answering some of the questions.
Over the next decade, China’s growth will slow, probably
sharply. That is not the view of malevolent
outsiders. It is the view of the Chinese government. The question is whether it
will do so smoothly or abruptly. On
the answer depends not only China’s own future, but also that of much of the
world.
Official Chinese thinking was on display at last month’s
China Development Forum, organized by the Development Research Center of the
State Council (DRC), which brought influential foreigners together with
high-level officials. Among the background papers was one prepared by
economists at the DRC, entitled “Ten-year Outlook: Decline of Potential Growth
Rate and Start of a New Phase of Growth”. Its proposition is that China’s growth will slow from more than 10 per
cent a year from 2000 to 2010 to 6.5 per cent between 2018 and 2022 Such a
decline, notes the paper, is consistent with the slowdown since the second
quarter of 2010.
The authors note two possible reasons for the decline:
either China has fallen into the “middle income trap” of aborted industrialization;
or it is managing the “natural landing” that occurs when an economy begins to
catch up with advanced economies. This latter scenario played out in Japan in
the 1970s and South Korea in the 1990s. The DRC paper argues that, after 35
years of 10 per cent growth, it is at last happening to China.
Here are a few reasons why the authors say this view is plausible. First, the potential for
infrastructure investment has “contracted conspicuously”, with its share in
fixed asset investment down from 30 per cent to 20 per cent over the past
decade. Second, returns on assets have fallen and overcapacity has soared. The “incremental capital output
ratio” – a measure of the growth generated by a given level of investment –
reached 46 in 2011, the highest since 1992 China is getting less growth bang
for its investment buck. Third, growth of the labour supply has fallen sharply.
Fourth, urbanization is still rising, but at a decelerating rate. Finally,
risks are growing in the finance of local governments and real estate.
Q-1. Which
scenario played out in Japan in 1970s and South Korea in the 1990s?
01. Aborted
industrialization
02. Slow down in growth at 6.5 %
03. Managing the “natural landing”
04. Growth of 10 % for ten years
05. Both 1 and 2
Q-2. Which of the
following is/are the reasons for the decline in China’s growth according to the
authors of “Ten year Outlook: Decline of Potential Growth Rate and Start of a
new Phase of Growth”?
A. China has fallen
into the middle income trap of aborted industrialization.
B. The “natural
landing” is being managed by China.
C. It has began to
catch up with advanced economies.
01. Only A
02. All A, B, and C
03. Only A and C
04. Only A and B
05. Only B
Q-3. What is the “Ten-Year Outlook’s proposition for China?
01. A consistent slowdown
in the growth of China since the second quarter of 2010.
02. A growth of 10% a year from 2000 to 2010.
03. China’s growth will slow to 6.5 % between 2018
to 2022
04. There would be a decline of potential growth
rate in China but a new phase of growth would soon start.
05. Only 1 and 3
Q-4. Which of the
following is NOT one of the reasons of decline in China’s growth according
to the authors?
01. Returns on assets
have fallen and overcapacity has increased.
02. China is getting less growth bang in
investment sector.
03. Risks are growing in the finance of local
governments and real estate.
04. The share of infrastructure investment in
fixed asset has been from 30 % to 20 % over the past decade.
05. There has been a sharp fall in the growth of
the labour supply.
Q-5 Which of
the following is definitely TRUE in context of the passage?
01. China’s and much of the world’s future depends
on whether China will handle the rise in its growth smoothly or abruptly.
02. China experienced a reduction in growth from 10 % to 6.5% from
2000 to 2010.
03. The incremental capital output ratio of China
was 56 in the last decade.
04. Local government of China faces minimum risk
in the finance and real estate sector.
05. China is struggling
to catch up with developed economies.
Q-6. Choose the
word which is most nearly the OPPOSITE in meaning as the word printed in bold
as used in the passage.
soared
01. retreat
02. surged
03. declined
04. dissipated
05. descend
Q-7 Choose the
word which is most nearly the OPPOSITE in meaning as the word printed in bold
as used in the passage.
plausible
01. persuasive
02. credible
03. unreasonable
04. logical
05. reliable
Q-8 Choose the
word which is most nearly the SAME in meaning as the word printed in bold as
used in the passage.
proposition
01. condemnation
02. refusal
03. hypothesis
04. ambiguity
05. misconception
Q-9 Choose the word which is most nearly the
SAME in meaning as the word printed in bold as used in the passage.
abruptly
01. suddenly
02. expectedly
03. late
04. gradually
05. consciously
Q-10. Choose the
word which is most nearly the SAME in meaning as the word printed in bold as
used in the passage.
malevolent
01. amiable
02. compassionate
03. complementary
04. hostile
05. agreeable
ANSWERS
1. 3
2. 4
3. 4
4. 4
5. 2
6. 3
7. 3
8. 3
9. 1
10. 4
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