Reading comp PrepTest 156 · Section 1 · Question 18

Passage

 Traditionally, corporate bankruptcy law placed highest priority on the orderly discharge of debts; courts generally ordered failed businesses to pay Remaining source text redacted.
Passage walkthrough
Passage Summary

Topic:
Legal Studies

Paragraph 1

  • Paragraph note
    • Old Approach/New Approach; arguments for old
  • Views, minor Meta-Structures, and the author's attitude
    • Old Approach: Bankruptcy's focus is repayment of creditors
    • New Approach: Bankruptcy's focus is restructuring to keep company in business
    • Jackson (Old Approach): Focus should be on repaying creditors as much as possible


Paragraph 2

  • Paragraph note
    • Korobkin criticizes Jackson/Old Approach
  • Views, minor Meta-Structures, and the author's attitude
    • Korobkin: Old Approach fails to take other stakeholders into account (customers, employees, suppliers)
    • Korobkin: Old Approach prevents benefits of company


Paragraph 3

  • Paragraph note
    • Korobkin: Principles for New Approach
  • Views, minor Meta-Structures, and the author's attitude
    • Korobkin: New Approach fair and acceptable
    • Principle 1, Inclusion: all affected individuals taken into account
    • Principle 2, Rational Planning Salvage potential: "rank" those affected and take care of most affected first


Paragraph 4

  • Paragraph note
    • Author's opinion
  • Views, minor Meta-Structures, and the author's attitude
    • Author: Korobkin/New Approach more equitable
    • Author - Significant weaknesses of Korobkin/New Approach
      • Creditors are put at higher risk, so they charge more for credit
      • Doesn't tell us how to "rank" how badly different groups affected


Main Point:

While Korobkin's modern approach to bankruptcy is more equitable than Jackson's traditional approach, it has significant weaknesses.



Key Lines (P(aragraph) X, S(entence) Y)?

P1, S1 - Old Approach
P1, S2 - New Approach
P1, S3 - Argument for Old Approach
P2, S1 - Old Approach criticized
P3, S1 - New Approach benefits
P3, S2 - One principle of New Approach
P3, S3 - Second principle of New Approach
P4, S1 - Author's opinion of New Approach (and comparison to Old Approach)



Meta-Structure?

Old Approach/New Approach: The opening two sentences of this passage present a traditional and modern approach to bankruptcy law, setting this up as an Old Approach/New Approach passage. The rest of the passage discusses the benefits and criticisms of these approaches, meaning this Meta-Structure defines the passage. When a passage falls into this Meta-Structure, the author's opinion of the New Approach is generally the main point. Here, that opinion is most clearly stated in P4, S1: the New Approach is more equitable than the Old Approach, but it has some significant weaknesses. (See Last Thoughts? for a bit more on this.)



Last Thoughts?

Check the first sentence of Paragraph 4 again — it's a bit trickier than it might first appear, for two reasons. First, it compares the Old Approach and New Approach, but only on equity. The second part of the sentence claims that the New Approach has significant drawbacks, but it doesn't say that these drawbacks are more significant than the Old Approach's drawbacks. Which brings us to our second point: this passage can feel like a Resolving a Debate passage, but the author doesn't resolve the debate as to which of the two approaches is better. The author argues the New Approach is more equitable than the Old Approach but the New Approach also says it has downsides. The author never concludes whether we should go with the Old Approach, the new one, or a hybrid approach. As such, the main point of this passage is the author's opinion of the New Approach, not a recommendation or endorsement of one of the two approaches.

Question prompt

It can be inferred Remaining source text redacted.
Why the credited answer is right

Credited answer: C

The notes below walk through why it fits the stem and how to eliminate the rest.

Question Type

Legal

Answer choices

  1. A
    Bankruptcy laws should be Remaining source text redacted.
    Why choice A is not credited
    (P1, S2-4) It's modern bankruptcy law that focuses on allowing businesses to continue operating, but Jackson prefers the traditional method. So this answer is incorrect.
  2. B
    The claims of those Remaining source text redacted.
    Why choice B is not credited
    (P1, S4) Jackson's viewpoint is that bankruptcy law should allow for a fair adjudication process, but the passage never clarifies what that means. It could mean, as this answer states, that those who are owed the largest amount of money are paid back first. But it could instead mean that those who loaned money earliest should be paid back first. Since the passage doesn't dive into what Jackson means by "fairly adjudicated," we can't infer his meaning, so this answer is unsupported.
  3. C
    Bankruptcy law should favor Remaining source text redacted.
    Why choice C matches the stem

    Question Type:
    Viewpoint/Must Be True

    Strategy Overview:
    Identify the location of Jackson's arguments in the passage, review them, and then find an answer that aligns with them

    Answer Anticipation/Relevant Lines:
    Our first step on question that asks us to infer one's viewpoint is to identify where the passage presented those views. Our notes point us to the end of Paragraph 1, and they tell us that Jackson is the proponent of the Old Approach of focusing bankruptcy law on repaying creditors.

    Looking to the end of P1, we see that he argues bankruptcy law should be simply a debt collection device, allowing for a fair and efficient debt collection process. Let's look for an answer aligned with those views.

    Answer Choice Explanation:
    (P1, S2-4) Modern bankruptcy law focuses on taking all stakeholders, including employees, into account when adjudicating a bankruptcy. The traditional method just cares about creditors. Therefore, this answer aligns with the traditional approach. Since Jackson endorses the traditional model, Jackson must believe that creditors' rights supersede the rights of bankrupt company's employees. So this is the correct answer.

    Key Takeaway:
    Always track viewpoints and consider how they line up with the Meta-Structure of a passage. This passage used an Old Approach/New Approach Meta-Structure, with Jackson representing the Old Approach and Korobkin the New Approach. Keeping that straight makes it a lot easier to tackle a question like this. Particularly because, as we saw here, wrong answers tend to reflect the wrong viewpoint!

  4. D
    Bankruptcy laws that emphasize Remaining source text redacted.
    Why choice D is not credited
    (P4, S1) The author states that Korobkin's approach is more equitable than Jackson's, which may suggest that Jackson cares less about equity. Jackson also argues that the traditional approach is more efficient. As such, this answer is something with which he'd likely disagree.
  5. E
    The legal system should Remaining source text redacted.
    Why choice E is not credited
    (P1, S3) Jackson argues that bankruptcy laws should be simply a debt collection device, not a debt collection device only in certain circumstances. This answer runs counter to his viewpoint.

What this tests

Question analytics

Based on historical answer selection rates for this question.

Answer choice distribution

  1. A 12%
  2. B 24%
  3. C Credited 50%
  4. D 4%
  5. E 11%

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