Quiz

Question: What message does Professor Ferguson intend to convey when he says that 'Finance evolves through natural selection'?
Options:
A.Just as Darwinian evolution progresses to produce more complex life forms, so does finance evolve to produce more complex techniques.
B.Finance evolves through the three step natural selection process of creation, selection and destruction.
C.Changes occurring in the markets  prompt the development of new financial products and techniques.
D.As species less adapted to the surroundings go extinct in nature so do ill - conceived financial products in markets.
E.Both B and C
Answer: Option C
: C

See the fifth paragraph 'he believes that new sorts of finance ........ environment changes'. The idea that Professor Ferguson wants to convey here is that just as organisms evolve in accordance with the changes in their environment,so do new forms of finance develop as per new market conditions.
Option A equates evolution with progress which is just the opposite of what Professor Ferguson says. Options B and D are general statements.

Submit Answer & Explaination

Earn Reward Points by submitting Detailed Explaination for this Question

More Questions on This Topic :

Question 1. In the final paragraph, why does the author refer to the posterity as more equitable?
  1.    Because he thinks that the posterity will be inherently more just than the people of the abstruse philosopher's age.
  2.    Because he thinks the ignorance and caprice of the people of the abstruse philosopher's age will render them negatively biased towards him or her
  3.    Because he thinks the ignorance and caprice of the people of the abstruse philosopher's age will render them positively biased towards him or her
  4.    Because he thinks that the philosophical errors committed by the abstruse philosopher will come into light only to the posterity that has the advantage of hindsight in regards to how the thought has played out in practice
Answer: Option D
: D

Option A suggests that the posterity will be inherently more just than the previous generation. This is nowhere stated nor can be inferred from the passage. Also, ‘equitable’ here is not in the sense of justness but more in the sense of being knowledgeable. Options B and C may look plausible but on close observation of the last paragraph: ‘that abstract reasoners seem hitherto to have enjoyed only a momentary reputation, from the caprice or ignorance of their own age, ‘ it is apparent that people of the abstruse philosopher’s time may have regarded him with positivity due to the prevalent ignorance or caprice. However it does not say anything about why the next generation should be more equitable. Option D suggests that the posterity will have the advantage of getting to know the philosopher’s thoughts both in theory and in practice, compare them and judge him for his philosophical accuracy. In this regard, they will be more knowledgeable or equitable.
Question 2. Where could have this passage most likely been published?
  1.    In a financial research journal as a review article on the current state of global finance.
  2.    In the proceedings of a financial conference where a professor would have delivered this as a talk.
  3.    In the book review column of a financial newspaper.
  4.    In the book review column of a journal on financial risk management.
  5.    Both B and C
Answer: Option C
: C

From the first line of the second paragraph 'This rushed, uneven book' it is clear that the article is a book review. The structure of the passage also confirms this. So we have options C and D to choose from.
The book deals with financial history as a whole and is intended for a general audience. Its wide scope makes it less likely to be published in a financial risk journal that would be meant for specialists of that field.
Question 3. According to the passage, which of the following behaviours of people are better explained by behavioural science than by economics?
  1.    Selling an asset at a price lower than its purchase price.
  2.    Taking a job that pays 70000 dollars a year today than working to build skills that may get them a 100000 dollar a year job after two years.
  3.    Selling a 200 dollar flight ticket at 205 dollars.
  4.    Both selling an asset at a price lower than its purchase price and taking a job that pays 70000 dollars a year today than working to build skills that may get them a 100000 dollar a year job after two years.
  5.    Both B and C
Answer: Option D
: D

In the first paragraph, the author mentions that the findings of behaviour science suggest that people 'devalue long term returns as compared to short term gains'. We also find an explanation of why 'people buy high and sell low'. The endowment effect is just the opposite of what is suggested by Option C. Economics and not behaviour science will say that people will sell their 200ticketfor 205.
Question 4. The primary function of the final paragraph of the passage is to:
  1.    Summarize the arguments made in the earlier paragraphs.
  2.    Convey the message to the readers that every cloud has a silver lining.
  3.    Lend support to one of the points that the author makes in his book.
  4.    Critically evaluate a new idea that is mentioned in the book.
  5.    Both B and C
Answer: Option C
: C

The reviewer opens the last but one paragraph by mentioning that the author makes two 'timely' points. So he agrees to these two points of Professor Ferguson. The last paragraph is about the second point, i.e. the important role played by finance in human progress.
Option B seems to be close but remember that this paragraph is not about financial crisis and the positive developments that may have happened during or after it. It is about how Ferguson sees finance as playing an important role to facilitate human progress.
Question 5. According to the passage, brain scanning technology can reveal all of the following regions of person's brain EXCEPT the regions that:
  1.    Determine the extent of his or her financial risk aversion
  2.    Become active during gambling
  3.    Govern rational responses to challenging situations. 
  4.    Determine the extent of his or her financial risk aversion and govern rational responses to challenging situations.
  5.    Both B and C
Answer: Option C
: C

In the second paragraph, while the author mentions that brain scans can help isolate the parts that govern how we react to challenges, he does not say whether the responses are rational or not. The parts of the brain that determine a person's financial risk appetite and those that are activated while he's gambling have been identified by researchers. So A and B cannot be the answer choices.

Check all Questions in this Topic : Click HERE

Recent Questions

Q. The Time Required To Complete A Task Is Established And A Bo....Q.  what Rate Percent Does A Man Get For His Money When In Dis....Q. Given, N = 98765432109876543210 ..... Up To 1000 Digits, Fin....Q. If A : B = 3 : 4 And B : C = 8 : 9, Then A : B : C Is = ?....Q. Which Method Enables You To Calculate Whether Daylight Savin....Q. The New Strain Of Bacteria Produced By Biotechnology In Alco....Q. In Rig Vedic Period, The Basis Of Both Social And Political ....Q.  servers Handle Requests For Other Domains....Q. If The Helix Angle Of The Drill Is Made ________ 30°, Then ....Q.  specialised Programs That Assist Users In Locating Informa....Q. Positive Income Elasticity Implies That As Income Rises, Dem....Q. The Compression Ratio Is The Ratio Of....Q. If A Load W Is Applied Instantaneously On A Bar; Then The S....Q. Work Speed Of Circular Electrode Of 220 Mm Diameter For Carr....Q. The Change Of Entropy, When Heat Is Absorbed By The Gas, Is....Q. Pick Out The Wrong Statement.....Q. Software Is:....Q. The Permissible Stress In The Fillet Weld Is 100 N/mm². The....Q. Bell Metal Is An Alloy Of....Q. Rateau Turbine Is....Q. When Current Feedback (negative) Is Applied To An Amplifier,....Q. When The Mach Number Is Between __________ The Flow Is Calle....Q. Sillimanite Is A __________ Refractory.....Q. An Ideal Traction System Should Have....Q. Which One Type Of Radiation Has The Longest Wave Length....Q. The Press-pull Tool Will ________ The Face Of A Solid Model ....Q.  during Processing Data, Programs, And Processed Informatio....Q.  digital Computers Use A ......................... System T....Q. Statement : The Company X Has Rejected First Lot Of Values S....Q. The Major Pedogenic Process Acting On Soils At The Macro Sca....Q. The Basic Purpose Of Drum In Boiler Is To....Q. In Hot Machining, Tool Is Made Of....Q. A Projectile Is Thrown At An Angle ‘α’ To The Horizonta....Q. Find Out That Word, The Spelling Of Which Is Wrong.....Q. The Radial Distance Of A Tooth From The Pitch Circle To The ....Q. A Car Moves On A Circular Path Of Radius 10 Metre. It Comple....Q. He Died In The Year 1960 At 11pm On 14 July.....Q. His Pocket Has Been Picked.....Q. In Metal Machining, The Work-tool Contact Zone Is A Zone Whe....Q. For Welding Plates Of Thickness More Than 12.5 Mm, Its Edges....Q. The Estimated Value At Which An Asset Is Expected To Be Sold....Q. Arrange The Words Given Below In A Meaningful Sequence. 1. B....Q. As Per Icao, For Airports Serving Big Aircrafts, The Crosswi....Q. A Meteor Is....Q. Find The Missing Term : 7, 8, 18, 57, ?, 1165....Q. For A Flood Control Reservoir, The Effective Storage Is Equa....Q. The Advantage Of Having A Tandem Master Cylinder Arrangement....Q. Inter-distance Between Ventilation Columns In A Sewer Line I....Q. In Each Pollen Sacs A Large Number Of Pollens Or Microspores....Q. In A Single Stage, Single Acting Reciprocating Air Compresso....