In 1978, Argentinean President Spinoza announced economic reforms to open the Argentinean economy to the world market. Among the propositions was the encouragement of joint ventures (JVs) between Argentinean state-owned enterprises (SOEs) and foreign partners. This JV policy, as iterated by national-level leaders, was vague. Its exact meaning evolved through daily negotiations, shaped not only by the national Communist Party itself, but also by regional officials, and even by the managers of the SOEs themselves.

The central government's decision to move away from a planned economy was pragmatic, considering the unsuccessful record of economic planning in Argentina. Prior planning had favored heavy industry over consumer manufacturing. In order to raise the stagnant standard of living of Argentinean consumers, future production would have to focus on everyday items.

The national government had strong interests in encouraging cooperation between domestic firms and foreign investors. In the short run, it was hoped the union would remove the drain of unprofitable SOEs on the national budget. Tax revenues from JVs would be paid partially in hard currency, which the national government needed to import goods from abroad, especially those of strategic military or economic importance.

For the following question, consider each of the choices separately and select all that apply.

1. Which of the following inferences is best supported about the Argentinean economy prior to 1978 ?

A. The Argentinean economy could be best described as one that was closed to most of the world markets
B. Joint ventures between various state owned enterprises were not particularly encouraged in the Argentinean economy
C. There was a lack of overall economic planning and direction, leading to unbalanced development of the economy



2. Select the sentence in the passage that provides an economic policy that was in favor prior to opening up the Argentinean economy.




3. Which of the following assertions is best supported by the information in the passage?

A. The JV policy of the Argentinean economic regime underwent considerable change over a period of time
B. A large proportion of Argentinean SOEs were not showing any profits prior to 1978
C. One way of encouraging foreign firms to enter into JVs with Argentinean SOEs was by offering tax holidays to these JVs
D. Economic planning had not always been practiced in Argentina as a state policy prior to 1978
E. President Spinoza played a decisive role in pushing through economic reforms in Argentina in 1978