Management Aptitude Test Dec 2019 Paper

Question : 80 of 200

Marks: +1, -0

Direction Answer the questions based on the information given in the passage.

The current trend in crude oil prices gives a serious cause for concern and if this persists, many of the calculations indicating further recovery and improved growth for the economy can be nullified. This year, the oil prices have risen from

\$ 70

per barrel to briefly touch

\$ 87

, falling back somewhat thereafter. Such levels have not been seen since October

2008 .

That year, oil crossed a historic

\$ 140

per barrel. It is the continued upward trend (except for the period of recession in the global economy) through the later part of the last year, which shows no signs of abating. High oil prices, which rein in growth, will be a bad news for India in more than one way. Slower growth will take away some of the buoyancy that revenue collection is now displaying. But India's problem is compounded by the fact that oil prices are not fully passed on and thus result in under-recoveries for the oil marketing companies. Which of the following is not in consonance with the contents of the passage?

For India to be on a sustainable growth path, its energy prices will have to be market determined and go up if global prices go up
The under recoveries ruin the finances of the oil marketing companies, and sap their energy and desire to run themselves efficiently
According to a senior Oil Ministry official, if oil prices again touch $\$ 87$ a barrel and refuse to come down, then with the current consumer prices, the current financial year can end up with a massive under-recovery of $₹ 80000$ crore
Since there is no election round the corner, government has in an arrogant manner raised the prices of oil (both diesel and petrol) and passed on the same to a common man, who is already hard hit due to a very high level of inflation

Validate

Solution:

If the prices increases are not fully passed on, option (c) may be inevitable. Refer to But India's problem ....... for the oil marketing companies. Hence, option (a) is in consonance with the text. If oil companies have under recoveries that will lead to financial ruin, they will definitely not be buoyant. Hence, option (b) is also in consonance with the text. The option

({\d})

is not in consonance with the text because it states that the oil prices are not fully passed on.

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