1. The primary purpose of the passage is to
(A) present a commonplace idea and its inaccuracies
(B) describe a situation and its potential drawbacks
(C) propose a temporary solution to a problem
(D) analyze a frequent source of disagreement
(E) explore the implications of a finding
The best answer is B. The author begins by describing in the first two paragraphs the, new opportunities for minority-owned businesses in the United States engendered by changes in federal law. The author then goes on in the last three paragraphs to point out three specific risks for minority-owned businesses posed by the new federal laws. Thus a situation is described and the drawbacks that it might entail are suggested.
2. The passage supplies information that would answer which of the following questions?
(A) What federal agencies have set percentage goals for the use of minority-owned businesses in public works contracts?
(B) To which government agencies must businesses awarded federal contracts report their efforts to find minority subcontractors?
(C) How widespread is the use of minority-owned concerns as “fronts” by White backers seeking to obtain subcontracts?
(D) How many more minority-owned businesses were there in 1977 than in 1972?
(E) What is one set of conditions under which a small business might find itself financially overextended?
The best answer is E. Choices A and B can be eliminated because the passage mentions only "some federal and local agencies" (lines 14-15), not any specific ones. C and D can be eliminated because no specific data are provided about minority-owned firms except in the area of the value of their corporate contracts. Only E is clearly answered by the passage; the author describes in lines 33-36 the possibility of a reduction in subcontracts leaving a small business that had just expanded (lines 28-33) financially overextended.
3. According to the passage, civil rights activists maintain that one disadvantage under which minority-owned businesses have traditionally had to labor is that they have
(A) been especially vulnerable to governmental mismanagement of the economy
(B) been denied bank loans at rates comparable to those afforded larger competitors
(C) not had sufficient opportunity to secure business created by large corporations
(D) not been able to advertise in those media that reach large numbers of potential customers
(E) not had adequate representation in the centers of government power
The best answer is C because lines 4-9 state that civil rights activists have long argued that a problem for members of minority groups who are attempting to establish businesses has been that minority groups "lack access to the sizable orders and subcontracts that are generated by large companies."
4. The passage suggests that the failure of a large business to have its bids for subcontracts result quickly in orders might cause it to
(A) experience frustration but not serious financial harm
(B) face potentially crippling fixed expenses
(C) have to record its efforts on forms filed with the government
(D) increase its spending with minority subcontractors
(E) revise its procedure for making bids for federal contracts and subcontracts
The best answer is A. In lines 28-36 the author points out that small businesses might have to make substantial new investments to meet the demands of a large subcontract, and that small business could thus "face potentially crippling fixed expenses." Large businesses, the author suggests in line 30, would not have to make such investments, and therefore would not face serious financial consequences. In lines 39-42 the author notes that if a company is small, it must get orders quickly, or "the financial health of the business will suffer." Thus, although any firm would suffer if it did not receive orders for subcontracts quickly, only small firms facing large fixed expenses would experience serious financial harm. Large firms do not face or can handle these expenses.
5. The author implies that a minority-owned concern that does the greater part of its business with one large corporate customer should
(A) avoid competition with larger, more established concerns by not expanding
(B) concentrate on securing even more business from that corporation
(C) try to expand its customer base to avoid becoming dependent on the corporation
(D) pass on some of the work to be done for the corporation to other minority-owned concerns
(E) use its influence with the corporation to promote subcontracting with other minority concerns
The best answer is C. The passage states in lines 55-57 that becoming dependent on one large corporate customer constitutes a "danger" for a minority enterprise. It is then noted in lines 58-64 that it is "difficult for small concerns to broaden their customer bases" even at the best of times, but that it is important that they "struggle against complacency." Thus, the author implies that a minority firm should attempt to escape the danger of dependency on a single corporate customer, and that in order to do so such a firm must try to expand its customer base.
6. It can be inferred from the passage that, compared with the requirements of law, the percentage goals set by “some federal and local agencies” in highlighted text are
(A) more popular with large corporations
(B) more specific
(C) less controversial
(D) less expensive to enforce
(E) easier to comply with
The best answer is B. Lines 9-14 state that the law mandates that businesses simply do their best" to use minority subcontractors and report their efforts to the federal government. In contrast, the author notes in lines 14-17 that some federal and local agencies have gone much further, "so far as to set specific percentage goals." Thus, it can be inferred that the author considers the percentage goals of the federal and local agencies to be more specific than the more general requirements of federal law.
7. Which of the following, if true, would most weaken the author’s assertion that, in the 1970’s, corporate response to federal requirements (highlighted text) was substantial
(A) Corporate contracts with minority-owned businesses totaled $2 billion in 1979.
(B) Between 1970 and 1972, corporate contracts with minority-owned businesses declined by 25 percent.
(C) The figures collected in 1977 underrepresented the extent of corporate contracts with minority-owned businesses.
(D) The estimate of corporate spending with minority-owned businesses in 1980 is approximately $10 million too high.
(E) The $1.1 billion represented the same percentage of total corporate spending in 1977 as did $77 million in 1972.
The best answer is E. The author's assertion that, in the 1970's, the corporate response to federal requirements was substantial rests on the fact that "corporate contracts with minority businesses rose from $77 million in 1972 to $1.1 billion in 1977" (lines 20-22). The author's claim that such a rise indicates a substantial corporate response to federal requirements would be weakened if other factors were at work. Such a condition is presented only in choice E, where it is stated that the percentage of corporate spending remained constant; this implies that the increased dollar amount allocated to minority businesses was due simply to general economic growth and that minority businesses proportionally gained nothing during those years.
8. The passage most likely appeared in
(A) a business magazine
(B) an encyclopedia of Black history to 1945
(C) a dictionary of financial terms
(D) a yearbook of business statistics
(E) an accounting textbook
The best answer is A. The passage presents general information about a business topic in a manner accessible to the interested reading public. The language is not technical, the statistics are few, and yet the focus is resolutely on a contemporary business phenomenon. This 'style suggests a publication oriented toward presenting general news and analysis of the business world to the interested public. Of the five choices, only A does this. B focuses on the wrong time period, C on a task-definition of financial terms-not performed by the passage, and D and E on information not
present to any significant degree in the passage
9. The author would most likely agree with which of the following statements about corporate response to working with minority subcontractors?
(A) Annoyed by the proliferation of “front” organizations, corporations are likely to reduce their efforts to work with minority-owned subcontractors in the near future.
(B) Although corporations showed considerable interest in working with minority businesses in the 1970’s, their aversion to government paperwork made them reluctant to pursue many government contracts.
(C) The significant response of corporations in the 1970’s is likely to be sustained and conceivably be increased throughout the 1980’s.
(D) Although corporations are eager to cooperate with minority-owned businesses, a shortage of capital in the 1970’s made substantial response impossible.
(E) The enormous corporate response has all but eliminated the dangers of over-expansion that used to plague small minority-owned businesses.
The best answer is C because the author states in lines 22-25 that "no letup [is] anticipated" in the projected total of corporate contracts with minority businesses throughout the next decade. There is no support in the passage for any of the other choices.
18 Apr 2022, 10:11
67% (03:01) correct
