Reading comp PrepTest 157 · Section 4 · Question 8
Passage
Passage A Markets, such as stock exchanges, distill the collective wisdom of millions of individuals into a single number, and
Remaining source text redacted.
Passage walkthrough
Passage Summary Topic:
Social Science
Passage A
Paragraph 1
Passage B
Paragraph 1
Main Points?
Passage A: Markets, including prediction markets, reflect the collective knowledge of many investors with remarkable efficiency.
Passage B: Markets, including prediction markets, are not inherently reliable; instead, they merely reflect the majority opinion at any given time.
Key Lines?
Passage A: Paragraph 1, Sentence 2 (P1, S1) - Author's attitude toward markets
P1, S2 - Contrast to committees and polls
P2, S2 - Example of a reliable forecast market
P2, S5 - Illustration of efficiency
P2, S2 - Reason
P3, S1 - Another reason
Passage B: P1, S1 - Author's attitude toward markets
P2, S1 - Example of unreliable forecast market
P3, S1 - Comparison
P4, S2 - Author's explanation of markets' function
Meta-Structure? Relationship Between Passages?
Relationship - Opposing Viewpoints: The authors of these two passages have opposing viewpoints. The author of passage A places a lot of ... ahem ... stock into markets, particularly in their efficiency and accurate forecasting. In contrast, the author of passage B does not believe markets are inherently trustworthy or accurate predictors, instead claiming that they merely reflect the majority opinion at a given time. Even so, there are a few moments in which these authors find common ground. Both think forecast/prediction markets reflect what the market as a whole believes (PA, P2, S6; PB, P2, S2), and both think the requirement that you invest money into a market makes markets at least slightly more reliable than polls (PA, P1, S2; PB, P4, S4).
Example (Both): Both passages bring up an example — the same example, in fact — to prove a minor point. In passage A, the author cites the accuracy of the Iowa Electronic Markets to illustrate the reliability of markets, as opposed to polls (PA, P2, S2). In passage B, the author cites a recent election in which the Iowa Electronic Markets' forecast was inaccurate for nearly a year to illustrate how markets are not infallible (PB, P2). Since the same example is used in both passages — and both are used to support each passage's main point — we should expect at least one question about them.
Comparison (Both): Both passages compare markets to polls. And both claim that markets are at least somewhat more reliable than polls, as markets require people to back up their opinions with money (PA, P1, S2; PB, P4, S4). This is a point on which the authors agree, in passages in which they mostly disagree, so we should expect a question on this as well.
Last Thoughts?
This is a quintessential Opposing Viewpoint passage, so expect several questions about the authors’ disagreement, and at least one question about a point of agreement.
Social Science
Passage A
Paragraph 1
- Paragraph note
- Author: Efficiency of markets
- Views, minor Meta-Structures, points of intersection, and the author's attitude
- Comparison: Efficiency of markets (requires "hard dollars," rewards people who are "right") vs. committees/polls (doesn't require dollars, rewards loudest/most prestigious)
- Author's attitude: "amazing efficiency" (first sentence)
- Paragraph note
- of "forecast market"
- Views, minor Meta-Structures, points of intersection, and the author's attitude
- Example: Iowa Electronic Market (second through last sentence)
- Paragraph note
- Support: Market's efficiency
- Views, minor Meta-Structures, points of intersection, and the author's attitude
- Definition: Efficiency: Market learns what informed people know (first sentence)
- Example: Experiment with fictional stock and "insiders" (second through last sentence)
- Author's attitude: "lightning fast and very accurately" (first sentence)
Passage B
Paragraph 1
- Paragraph note
- Author: Markets not perfect
- Views, minor Meta-Structures, points of intersection, and the author's attitude
- Author's attitude: "not infallible" (first sentence), "get over it" (last sentence)
- Paragraph note
- Support: Iowa Electronic Market's inaccuracy
- Views, minor Meta-Structures, points of intersection, and the author's attitude
- Undermines Passage A, second paragraph
- Paragraph note
- Comparison to horseracing
- Views, minor Meta-Structures, points of intersection, and the author's attitude
- Comparison: Lower price of stock = greater odds for horse
- Paragraph note
- Author's correction: Prediction polls simply reflect majority opinion at a given time
- Views, minor Meta-Structures, points of intersection, and the author's attitude
- Similarity to passage A: Similar definition of "forecast" market from the second paragraph
- Similarity to passage A: claims that "entrance fees" of markets is an advantage over polls like passage A's author did in the first paragraph
- Author's attitude: "merely reflect" (first sentence), "does not imbue them with any special omniscience" (second sentence), "more serious responses," "just as potentially wrong" (third sentence)
Main Points?
Passage A: Markets, including prediction markets, reflect the collective knowledge of many investors with remarkable efficiency.
Passage B: Markets, including prediction markets, are not inherently reliable; instead, they merely reflect the majority opinion at any given time.
Key Lines?
Passage A: Paragraph 1, Sentence 2 (P1, S1) - Author's attitude toward markets
P1, S2 - Contrast to committees and polls
P2, S2 - Example of a reliable forecast market
P2, S5 - Illustration of efficiency
P2, S2 - Reason
P3, S1 - Another reason
Passage B: P1, S1 - Author's attitude toward markets
P2, S1 - Example of unreliable forecast market
P3, S1 - Comparison
P4, S2 - Author's explanation of markets' function
Meta-Structure? Relationship Between Passages?
Relationship - Opposing Viewpoints: The authors of these two passages have opposing viewpoints. The author of passage A places a lot of ... ahem ... stock into markets, particularly in their efficiency and accurate forecasting. In contrast, the author of passage B does not believe markets are inherently trustworthy or accurate predictors, instead claiming that they merely reflect the majority opinion at a given time. Even so, there are a few moments in which these authors find common ground. Both think forecast/prediction markets reflect what the market as a whole believes (PA, P2, S6; PB, P2, S2), and both think the requirement that you invest money into a market makes markets at least slightly more reliable than polls (PA, P1, S2; PB, P4, S4).
Example (Both): Both passages bring up an example — the same example, in fact — to prove a minor point. In passage A, the author cites the accuracy of the Iowa Electronic Markets to illustrate the reliability of markets, as opposed to polls (PA, P2, S2). In passage B, the author cites a recent election in which the Iowa Electronic Markets' forecast was inaccurate for nearly a year to illustrate how markets are not infallible (PB, P2). Since the same example is used in both passages — and both are used to support each passage's main point — we should expect at least one question about them.
Comparison (Both): Both passages compare markets to polls. And both claim that markets are at least somewhat more reliable than polls, as markets require people to back up their opinions with money (PA, P1, S2; PB, P4, S4). This is a point on which the authors agree, in passages in which they mostly disagree, so we should expect a question on this as well.
Last Thoughts?
This is a quintessential Opposing Viewpoint passage, so expect several questions about the authors’ disagreement, and at least one question about a point of agreement.
Question prompt
Both passages are primarily
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
Social Science
Answer choices
-
AIs collective wisdom more Remaining source text redacted.
Why choice A is not credited
Both passages discuss the "collective wisdom" of markets, but neither compares that collective wisdom to "individual judgment." The latter topic is not mentioned in either passage, so this answer choice can be swiftly eliminated. -
BWhat can be learned Remaining source text redacted.
Why choice B is not credited
A test-taker who anticipated what the correct answer should say — and relied on this anticipation when appraising the answer choices — would likely note that this didn't mention anything about the "reliability" of markets and would move on to the next option without much thought. To less-prepared test-takers, however, this answer choice may be tempting. But beyond lacking "reliability," there are a few issues here. One, "stock markets" were merely an example of a market in passage A (PA, P1, S1) but were never explicitly mentioned in passage B. In fact, both passages focus on prediction/forecast markets far more than stock markets. Second, we can infer what the authors think we can learn from price movement on stock markets. The author in passage A might say this is evidence that people realize the company's value is changing. In contrast, the author of passage B would probably say the only thing changing is the majority's opinion of the value. But neither passage explicitly addresses this issue, so this can't be the correct answer to a Main Point question. -
CCan markets be used Remaining source text redacted.
Why choice C matches the stem
Question Type:
Major Point/Main Point
Strategy Overview:
Review the main point of both passages, looking for a way to frame the main point as a question that both passages answer
Answer Anticipation:
This is the first question on almost all Comparative Passages. We can think of this as a Main Point question, in which the main point is framed as finding a question that both passages are meant to answer. To answer this, we should think of the main point of both passages, and try to frame that main point as a question that both passages attempted to answer.
Fortunately, these passages reach opposing conclusions. This should make framing the main point as a question both passages answer a more straightforward task. Passage A concludes that markets, including prediction markets, are reliable reflections of the collective knowledge of many investors. In contrast, passage B concludes that markets, including prediction markets, are not inherently reliable; instead, they merely reflect the majority opinion at any given time. So both passages are concerned with the question of whether markets are reliable. We should look for that in the answer choices.
Answer Choice Explanation:
This is very close to our anticipation, and it is the correct answer. One way to check whether an answer is correct on this type of question is to see if the authors' main points provide an answer. Both main points answer this question. Passage A concludes that markets are reliable reflections of the collective knowledge of many investors with remarkable efficiency. So passage A would answer this question with a resounding "Yes." In contrast, passage B concludes that markets are not inherently reliable. So, passage B would answer this question with a defiant "No."
Key Takeaway:
These Main Point-variations are among the more predictable questions on Comparative passages. We can reliably predict that they'll appear first on almost every Comparative passage. And we can reliably predict their answers by identifying the main point to both passages and framing the main points as a question. Remember to make your prediction, and rely on it to answer the questions. Doing so will allow you to quickly eliminate the answer choices that don't match your prediction without wasting much time or mental energy. -
DAre opinions more likely Remaining source text redacted.
Why choice D is not credited
A test-taker relying on their anticipation would likely note that this answer choice didn't mention anything about the "reliability" of markets and would eliminate this option without much thought. To other test-takers, however, this answer choice may be tempting because it describes a topic both passages address (as discussed in the "Comparisons (Both)" excerpt from Meta-Structures section above). However, both passages bring up this topic to support the main points; this topic is not the main point. -
EAre markets that are Remaining source text redacted.
Why choice E is not credited
"Stock markets" were merely an example of a market in passage A, but stock markets were never explicitly mentioned in passage B. Moreover, neither passage compares the efficiency of stock markets to that of prediction markets. Passage B doesn't even bring up the topic of efficiency at all.
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