English Quiz for LIC AAO 2016 – Set 2

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Directions (Q. 1-10):
Read the following passage to answer the given questions based on it. Some
words/phrases are printed in bold to help
you locate them while answering some of the questions.

India’s manufacturing growth fell
to its lowest in more than two years in September 2011, reinforcing fears that an extended period of high policy rates is
hurting growth, according to a closely watched index. The HSBC India Purchasing
Managers’ Index (PMI), based on a survey of over 500 companies, fell to 50.4
from 52.6 in August and 53.6 in July. It was the lowest since March 2009, when
the reading was below 50, indicating contraction. September’s index also
recorded the biggest one month fall since November 2008. The sub-index for new
orders, which reflects future output, declined for the sixth successive month,
while export orders fell for a third month on the back of weakness in global
economy. The Reserve Bank of India (RBI) last week indicated it was not done
yet with monetary policy tightening as inflation was still high. The bank has
already raised rates 12 times since March 2010 to tame inflation, which is at a 13-month high of 9.78%. Economists
expect the RBI to raise rates one more time but warn that targeted growth will
be hard to achieve if the slump
continues. “This (fall in PMI) was driven by weaker orders, with export orders
still contracting due to the weaker global economic conditions,” HSBC said in a
press release quoting its chief economist for India & ASEAN. PMI is
considered a fairly good indicator of manufacturing activity the world over,
but in the case of India, the large contribution of the unorganised sector yields a low correlation with
industrial growth. However, the Index for Industrial Production (IIP) has been
showing a weakening trend, having slipped to a 21-month low of 3.3% in July.
The core sector, which consists of eight infrastructure industries and has a
combined weight of 37.9% in the IIP, also grew at only 3.5% in August. The PMI
data is in line with the suffering manufacturing activity in India as per other
estimates. Producers are seeing that demand conditions are softening and the
outlook is uncertain, therefore they are producing less. Employment in the
manufacturing sector declined for the second consecutive month, indicating it
too was under pressure. This could be attributed to lower requirement of staff
and rise in resignations as higher wage requests go unfulfilled, the HSBC
statement said. On the inflation front, input prices rose at an 11-month low
rate, but despite signs of softening, they still remain at historically high
levels. While decelerating slightly, the readings for input and output prices
suggest that inflation pressures remain firmly in place. Most economists feel
the RBI is close to the end of its rate hike cycle. Even the weekly Wholesale
Price Index (WPI) estimates have started showing signs of softening, having
fallen more than one percentage point.
1. Which year did PMI
record the biggest one-month fall since 2008?
1) 2008
2) 2009
3) 2010
4) 2011
5) None of these
2. Which of the
following explains the phrase, as used in the passage, “it was not done yet”?
1) It is over now
2) There is no hope
3) There is still hope
4) Rates will be further raised
5) PMI will further fall
3. Which of the
following is the prediction of economists about RBI’s rate hike cycle, as per the
1) There will not be many rate hikes
2) The rate reduction cycle will start soon.
3) There will be many more rate hikes.
4) Not indicated in the passage.
5) None of these
4. Which of the
following is not true about PMI data in India?
1) It reflects decline in manufacturing.
2) In September 2011, PMI was 50.4.
3) Reduction is export orders affected PMI.
4) Other related estimates support PMI data.
5) PMI data is reported once in 3 months.
5. Which of the
following is indicated as one of the reasons for the fall in PMI?
1) Less number of orders were placed.
2) Unorganised sector failed to give the required results.
3) Industrial unrest reduced manufacturing.
4) RBI has stopped raising the rates.
5) WPI has shown signs of softening.
6. Which of the
following is correct in the context of the passage?
1) India’s manufacturing growth was the lowest in 2010.
2) PMI is not affected by high policy rates.
3) Employment in manufacturing sector was also affected
4) The input prices were lowest in 2011 as compared to
earlier years.
5) IIP was 37.9% in August.
Directions (Q. 7-8): Choose the word(s) which is most nearly the same in meaning to the word
in bold, as used in the

7. yields
1) relents 2) submits 3) produces 4) reduces 5) withstands
8. tame
1) increase 2) timid 3) study 4) control 5) understand
Directions (Q. 9-10):
Choose the word(s) which is most opposite in meaning of the word printed in
bold, as used in the passage.

9. reinforcing
1) contradicting 2) wishing 3) jolting 4) forcing 5)
10. slump
1) output 2) rise 3) slide 4) slack 5) input
Chitrarth – 9/10
Optimus Prime – 9/9
fighter – 8/9


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