PrepTest 106 - Section 4 - Passage 3 - Question 14

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Recently, a new school of economics called steady-state economics has seriously challenged neoclassical economics, the reigning school in Western economic decision making. ███

Intro topic · Steady-state economics (new view) vs. neoclassical economics (traditional view)

Neoclassical view · Economy is closed system between producers and consumers

Growth is necessary and unlimited

Steady-state view · Economy is open system dependent on nature

Neoclassical view is wrong; not a closed system. Resources enter system, waste leaves.

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Implications · of steady-state view

Growth is neither necessary nor unlimited. Economy has optimal size in theory. Too much growth is dangerous because it depletes resources and creates waste.

Neoclassical rebuttal · Natural resources can be replaced if depleted

problem · according to steady-state view

Western economies have exceeded optimal size

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Solution · according to steady-state view

Meet human wants without growth, e.g. by using resources more efficiently

Passage Style

Critique or debate

14.

Which one of the following ████ ██████████ ███ ██████████ █████████ ███ ████ █████ ██ ███ ████████

Question Type

Main point

The main point of this Debate passage is to show that the steady-state economic model is an alternative to the traditional neoclassical model. In the steady-state model, the economy is an open system that depends on nature, growth can (and should) be limited, and alternatives to growth should be implemented to make sure the economy can satisfy human wants.

Neoclassical economists, who, ██████ ████████████ ███████████ ████ ████ ████████ ██████ ██ ███ ███████ ██ ███████ ████████████ ███████ ████ ██████ ██ ████ ███ ███████ ██ ███ ███████ ███ ████ ██ ███████ █████████ ██ ███████ █████████ ███ ████████ ████ ███ ██ ████████ ████ ██████████ ██████████

While this is a good summary of the neoclassical view, this is not the main point of the passage as a whole. The main point of the passage is to show that the steady-state model is an alternative to the neoclassical model, but (A) doesn’t say anything about what the steady-state model is or why it could be an alternative to neoclassical economics.

Some neoclassical economists, ████ ██████ ████████████ ███████████ ████ ████ ██████ ██ ███████ ██ ███ ██████ ██ ██████████ ███████ ████ ███ █████████ ██ ███████ ████████ ██ ███████ █████████ ███ ████ ██ █████ ██ ███ ██████████ ███████ █████████ ██ █████████ ███████

Like (A), this is a good summary of neoclassical economics, but this misses the overall main point. The main point of the passage is to show that the steady-state model is an alternative to the traditional neoclassical model, but (B) doesn’t say anything about what the steady-state model is or why it’s a good alternative to neoclassical economics.

Some steady-state economists, ████ ██████ ████████████ ███████████ ████ ████ █████████ ██████ ██ ███████ ████████ ███ ██████████ ███████ ████ ███████ █████████ ██████ █████ ████████ ██████ ██ ████████ ████████████ ███████████ ████ ██ ████ ██████████ ████ ███████████ ██ ████████ ███████████

This is not an accurate summary of the steady-state view. It’s the neoclassical economists who warn about economic stagnation when growth is limited, but in response, the steady-state economists say that there are alternatives to growth that can still satisfy human desires. Also, conservation is just one possible alternative to growth, not the definitive alternative to growth.

Some steady-state economists, ████ ██████ ████████████ ███████████ ████ ████ ███ ███████ █████ ██ █████████ ███ ███████ ██ ███ ████████████ ██ ███████ ██████████ ███████ ████ ███████ █████████ ██████ █████ ████████ ██████ ███ █████ ████ ████████████ ████ █████████████ ████████████ ██ █████ █████ ████ ███ ██ ███████████

(D) captures the author’s point that the steady-state model is an alternative to the neoclassical model, and why. In contrast with the neoclassical economists, the steady-state economists think that resource availability limits the ideal size of the economy, and that conservation is one alternative to growth to make sure that the economy still satisfies human desires.

88%

Steady-state and neoclassical ███████████ ███ ████ ████ ████ █████████ ███████ ███ ████████ ████ ██ ████████ █████ ███████ █████████ ███ ██████████ ████████████ ██████ ████ ███ ████ █████████ ███ ██ ████████████ ████ █ ██████ ████████ ██ ████ ████████ █████ █████████ █████████ ██ ███████ ██████████

This is not supported by the passage. Steady-state economists don’t believe in unlimited growth, so they don’t want unimpeded increase in exchange value.

PrepTest 106 - Section 4 - Passage 3 - Question 14

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