50篇英语阅读理解

阅读理解习题

经济类

Unitl

SomeoftheconcernssurroundingTurkey'sapplicationtojointheEuropeanUnion,tobe

votedonbytheEU'sCouncilofMinistersonDecember17th,areeconomic-inparticular,the

country'srelativepoverty.ItsGDPperheadislessthanathirdoftheaverageforthe15pre-2004

membersoftheEU.ButitisnotfaroffthatofoneofthetennewmemberswhichjoinedonMay

1st2004(Latvia),anditismuchthesameasthoseoftwocountries,BulgariaandRomania,which

thisweekconcludedaccessiontalkswiththeEUthatcouldmakethemfullmembersonJanuary

1st2007.

Furthermore,thecountry'srecenteconomicprogresshasbeen,accordingtoDonaldJohnston,

thesecretary-generaloftheOECD,“stunning”.GDPinthesecondquarteroftheyearwas13.4%

higherthanayearearlier,arateofgrowththatnoEUcountrycomesclosetomatching.Turkey's

inflationratehasjustfallenintosinglefiguresforthefirsttimesince1972,andthisweekthe

countryreachedagreementwiththeIMFonanewthree-year,$10billioneconomicprogramme

thatwill,accordingtotheIMF'smanagingdirector,RodrigoRato,nhelpTurkey...reduceinflation

towardEuropeanlevels,andenhancetheeconomy'sresilience".

Resiliencehasnothistoricallybeenthecountry'seconomicstrongpoint.Asrecentlyas2001,

GDPfellbyover7%.Itfellbymorethan5%in1994,andbyjustunder5%in1999.Indeed,

throughoutthe1990sgrowthoscillatedlikeanelectrocardiogramrecordingaviolentheartattack.

Thisirregularityhasbeenoneofthemainreasons(alongwithredtapeandcorruption)whythe

countryhasfaileddismallytoattractmuch-neededforeigndirectinvestment.Itsstockofsuch

investment(asapercentageofGDP)islowernowthanitwasinthe1980s,andannualinflows

havescarcelyeverreached$1billion(whereasIrelandattractedover$25billionin2003,asdid

Brazilineveryyearfrom1998to2000).

OnedeterrenttoforeigninvestorsisduetodisappearonJanuary1st2005.Onthatday,

Turkeywilltakeawaytherightofvirtuallyeveryoneofitscitizenstocallthemselvesa

millionaire.Sixnoughtswillberemovedfromthefacevalueofthelira;oneunitofthelocal

currencywillhenceforthbeworthwhatImarenow-ie,about€0.53($0.70).Goodswillhavetobe

pricedinboththenewandoldliraforthewholeoftheyear,butforeignbankersandinvestorscan

begintolookforwardtoatimeinTurkeywhentheywillnolongerhavetojugglementallywith

indeterminatestringsofzeros.

1.WhatisIhrkey'seconomicsituationnow?C

[A]ItsGDPperheadisfarlaggingbehindthatoftheEUmembers.

fB]Itsinflationrateisstillrising.

[C]ItseconomygrowsfasterthananyEUmember.

[D]Itseconomicresilienceisverystrong.

2.Wecaninferfromthesecondparagraphthat__B.

|A]TurkeywillsooncatchtheaverageGDPlevelofthe15pre-2004EUmembers

fB]inflationrateinTurkeyusedtobeveryhigh

[C]Turkey'seconomywillkeepgrowingatpresentrate

[D]IMF'seconomicprogramwillhelpTurkeyjointheEU

3.Theword“oscillated”(Line3,Paragraph3)mostprobablymeansD___.

[A]fell

[B]climbed

[CJdeveloped

[D]swang

4.SpeakingofTurkey9sforeigndirectinvestment,theauthorimpliesthatC・

[A]ifsstockisfarlessthanthatofothercountries

[B]itdoesnothavemuchinfluenceonTurkey'seconomicprogress

[CJsteadyGDPgrowthwillhelpTurkeyattractmoreforeigndirectinvestment

[D]Turkey'seconomicresiliencereliesonforeigndirectinvestment

5.Wecandrawaconclusionfromthetextthat___A.

[A]foreigninvestmentenvironmentinTurkeywillbecomebetter

fB]Turkey'scitizenswillsufferheavylossduetothechangeofthefacevalueofthelira

[C]thelocalcurrencywilldepreciatewiththeremovalofsixnoughtsfromthefacevalue

[D]pricesofgoodswillgoup

Unit2

CharlieBellbecamechiefexecutiveofMcDonald'sinApril.Withinamonthdoctorstoldhim

thathehadcolorectalcancer.AfterstockmarkethoursonNovember22nd,thefast-foodfirmsaid

hehadresigned;itwouldneedathirdbossinunderayear.Yetwhenthemarketopened,itsshare

pricebarelydippedthenedgedhigher.Afterall,McDonald*shad,again,shownhowtoactswiftly

anddecisivelyinappointinganewboss.

MrBellhimselfgotthetopjobwhenJimCantalupodiedofaheartattackhoursbeforehe

wasduetoaddressaconventionofMcDonald'sfranchisees.MrCantalupowasaMcDonald's

veteranbroughtoutofretirementinJanuary2003tohelpremodelthefirmaftersalesbegan

fallingbecauseofdirtyrestaurants,indifferentserviceandgrowingconcernaboutjunkfood.He

devisedarecoveryplan,backedbymassivemarketing,andpromotedMrBelltochiefoperating

officer.WhenMrCantalupodied,arapidlyconvenedboardconfirmedMrBell,a44-year-old

Australianalreadywidelyseenashisheirapparent,inthetopjob.Theconventiongotits

promisedchiefexecutive'saddress,fromthefirm'sfirstnon-Americanleader.

YetwithinweeksexecutiveshadtothinkaboutwhattodoifMrBellbecametooillto

continue.PerhapsMrBellhadthesamethingonhismind:heusuallyintroducedJimSkinner,the

60-year-oldvice-chairman,tovisitorsasthe''steadyhandatthewheel".NowMrSkinner

(pictured),anexpertonthefirm'soverseasoperations,becomeschiefexecutive,andMikeRoberts,

headofitsAmericanoperations,joinstheboardaschiefoperatingofficer.

IsMrRobertsnowthenewheirapparent?Maybe.McDonald'shasbroughtinsupposedly

healthierchoicessuchassaladsandtoastedsandwichesworldwideand,insteadofrelyingfor

mostofitsgrowthonopeningnewrestaurants,hasturnedtoupgradingits31,000existingones.

Americahasdonebestatthis;underMrRoberts,like-for-likesalestherewereupby7.5%in

Octoberonayearearlier.

Thenewteam'staskistokeeptherevitalisationplanoncourse,especiallyoverseas,where

someAmericanbrandsaresaidtofacepoliticalhostilityfromconsumers.Thisisabigchallenge.

Isanin-housesuccessionthebestwaytotackleit?MrSkinnerandMrRobertsarebothcompany

veterans,havingjoinedinthe1970s.Somerecentacademicstudiesfindthattheplanned

successionofanewbossgroomedfromwithin,suchasMrBellandnow(arguably)MrRoberts,

producesbetterresultsthanlookinghastily,oroutside,forone.McDonald'ssmoothhandlingofits

serialmisfortunesatthetopcertainlyseemstoprovethepoint.Evenso,everyoneatMcDonald's

mustbehopingthatitwillbealongtimebeforethefirmfacesyetanothersuchemergency.

1.ThemainreasonfortheconstantchangeatthetopofMcDonaldis_C,

(Altheboard'sinterference

[BJthefallingsales

[C]thehealthproblemsofthechiefexecutives

fD]theconstantchangeofitsshareprice

2.WhichofthefollowingwasNOTacauseofthefallingsalesofMcDonald?A

[Althechangeofthechiefexecutive

[B]people'sconcernaboutjunkfood

[C]dirtyrestaurant

[D]indifferentservice

3.Thephrase“heirapparent”(Line7,Paragraph2)inthearticlemostprobably

meansD.

[A]someonewhohasthesameideas,aimsandstylewithaperson

[B]someonewhohastheunalienablerighttoreceivethefamilytitle

fC]someonewhoisappointedasaheirofaperson

fD]someonewhoislikelytotakeoveraperson'spositionwhenthatpersonleaves

4.Intermsofsuccessionatthetop,McDonald_B.

[A]hashadtomaderatherhastydecisions

(BJpreferstoappointanewbossfromwithin

[C]actsinaquickandunreasonableway

[D]surprisesallthepeoplewithitsdecisions

5.TowardMcDonald'sreactiontoemergenciesatthetop,thewriter'sattitudecanbesaidto

beD・

[A]indifferent

[B]doubtful

[C]objective

ID]praiseful

Unit3

TheannualreviewofAmericancompanyboardpracticesbyKorn/Ferry,afirmof

headhunters,isausefulindicatorofthehealthofcorporategovernance.Thisyear'sreview,

publishedonNovember12th,showsthattheSarbanes-Oxleyact,passedin2002totrytoprevent

arepeatofcorporatecollapsessuchasEnron'sandWorldCom's,hashadanimpactonthe

boardroom-albeitatanaverageimplementationcostthatKorn/Ferryestimatesat$5.Imperfirm.

Twoyearsago,only41%ofAmericanfirmssaidtheyregularlyheldmeetingsofdirectors

withouttheirchiefexecutivepresent;thisyearthefigurewas93%.Butsomethingshavebeen

surprisinglyunaffectedbythebacklashagainstcorporatescandals.Forexample,despitea

growingfeelingthatformerchiefexecutivesshouldnotsitontheircompany'sboard,the

percentageofAmericanfirmswheretheydohasactuallyedgedup,from23%in2003to25%in

2004.

Also,disappointinglyfewfirmshavesplitthejobsofchairmanandchiefexecutive.Another

surveyofAmericanboardspublishedthisweek,byA.T.Kearney,afirmofconsultants,foundthat

in200214%oftheboardsofS&P500firmshadseparatedtheroles,andafurther16%saidthey

plannedtodoso.Butby2004only23%overallhadtakentheplunge.Asurveyearlierintheyear

byconsultantsatMcKinseyfoundthat70%ofAmericandirectorsandinvestorssupportedthe

ideaofsplittingthejobs,whichisstandardpracticeinEurope.

Anotherdisappointmentistheslowprogressinabolishing''staggered"boards-oneswhere

onlyone-thirdofthedirectorsareupforre-electioneachyear,tothree-yearterms.Inventedasa

defenceagainsttakeover,suchboards,accordingtoanewHarvardLawSchoolstudybyLucian

BebchukandAlmaCohen,areunambiguously"associatedwithaneconomicallysignificant

reductioninfirmvalue0.

Despitethis,thepercentageofS&P500firmswithstaggeredboardshasfallenonly

slightly—from63%in2001to60%in2003,accordingtotheInvestorResponsibilityResearch

Centre.Andmanyofthosefirmsthathavebeenforcedbyshareholderstoabolishthesystemare

doingsoonlyslowly.Merck,apharmaceuticalcompanyintroubleoverthepossibleside-effects

ofitsarthritisdrugVioxx,isallowingitsdirectorstoruntheirfulltermbeforeintroducinga

systeminwhichtheyareallre-elected(orotherwise)annually.Othercompanies'staggeredboards

areentrenchedintheircorporatecharters,whichcannotbeamendedbyashareholders'vote.

Anyonewhoexpectedthescandalsof2001tobringaboutrapidchangeinthebalanceofpower

betweenmanagersandownerswas,atbest,naive.

l.TheSarbanes-Oxleyactismostprobablyabout____D____.

[A]corporatescandal

[B]corporatemanagement

[CJcorporatecost

[D]corporategovernance

2.Theword“backlash”(Line3,Paragraph2)mostprobablymeansD___.

[A]aviolentforce

(B]astrongimpetus

[CJafirmmeasure

[D]astrongnegativereaction

3.Accordingtothetext,separatingtherolesbetweenchairmanandchiefexecutive

isB_.

fA]acommonpracticeinAmericancompanies

fB]whatmanyEuropeancompaniesdo

[C]amusttokeepthehealthofacompany

fD]notapopularideaamongAmericanentrepreneurs

4.Welearnfromthetextthatanstaggered**board___A____.

fA]isadversetotheincrementoffirmvalue

[B]givesitsboardmemberstoomuchpower

[C]hasbeenabolishedbymostAmericancompanies

fD]canbevoteddownbyshareholders

5.TowardtheboardpracticeofAmericancompanies,thewriter'sattitudecanbesaidto

beD.

[A]biased

[B]pessimistic

fC]objective

ID]critical

Unit4

Mosteconomistshategold.Not,youunderstand,thattheywouldturnuptheirnosesatabar

ortwo.Buttheyfindthereverenceinwhichmanyholdthemetalalmostirrational.Thatitwas

usedasmoneyformillenniaisirrelevant:itisn'tanymore.Modernmoneytakestheformofpaper

or,moreoften,electronicdata.Toeconomists,goldisnowjustanothercommodity.

Sowhyisitspricesoaring?Overthepastweek,thishastopped$450atroyounce,upby9%

sincethebeginningoftheyearand77%sinceApril2001.Ah,comesthereply,goldtransactions

aredenominatedindollars,andtheriseinthepricesimplyreflectsthedollar'sfallintermsof

othercurrencies,especiallytheeuro,againstwhichithitanewlowthisweek.Expressedineuros,

thegoldpricehasmovedmuchless.However,thereisnoironlink,asitwere,betweenthevalue

ofthedollarandthevalueofgold.Arisingpriceofgold,likethatofanythingelse,canreflectan

increaseindemandaswellasadepreciationofitsunitofaccount.

Thisiswheregoldbullscomein.Thefallinthedollarisimportant,butmainlybecauseasa

storeofvaluethedollarstinks.Withafewlongishrallies,thegreenbackhasbeenonadownward

trendsinceitcameoffthegoldstandardin1971.Nowitissufferingoneofitsshaiperdeclines.At

themargin,extrademandhascomefromthosewhothinkdollars—indeedanymoneybackedby

nothingmorethanpromisestokeepinflationlow—adecidedlyriskyinvestment,mainlybecause

America,withtheworld'sreservecurrency,hasbeenabletocreateandboiTowsomanyofthem.

Theleastpainfulwayofrepayingthosedollarsistomakethemworthless.

Thestrikingexceptiontothisextrademandcomesfromcentralbanks,whichwouldliketo

sellsomeofthegoldtheyalreadyhave.Asalegacyofthedayswhentheircurrencieswerebacked

bythemetal,centralbanksstillholdone-fifthoftheworld'sgold.LastmonththeBankofFrance

saiditwouldsell500tonnesincomingyears.Butbigsalesbycentralbankscancausethepriceto

plunge—aswhentheBankofEnglandsold395tonnesbetween1999and2002.Theresultwasan

agreementbetweencentralbankstoco-ordinateandlimitfuturesales.

Ifthepriceofgoldmarcheshigher,thisagreementwillpresumablyberippedup,althougha

dollarcrisismightmakecentralbanksthinktwiceaboutswitchingintopapermoney.Willthe

overhangofcentral-bankgolddragthepricedownagain?Notnecessarily.AsJamesGrant,gold

bugandpublisherofGrant'sInterestRateObserver,anewsletter,pointsout,inrecentyearsthe

hugeglutofgovernmentdebthasnotstoppedasharpriseinitsprice.

l.Ineconomists9eyes,goldissomethingB____.

fA]theylookdownupon

(BJthatcanbeexchangedinthemarket

[C]worthpeople'sreverence

fD]thatshouldbereplacedbyotherformsofmoney

2.Accordingtotheauthor,oneofthereasonsfortherisingofgoldpriceisA,

[A]theincreasingdemandforgold

fB]thedepreciationoftheeuro

[C]thelinkbetweenthedollarandgold

[D]theincrementofthevalueofthedollar

3.WecaninferfromthethirdparagraphthatB.

[A]thedeclineofthedollarisinevitable

fB]Americabenefitsfromthedepreciationofthedollar

[CJthedepreciationofthedollarisgoodnewstoothercurrencies

fD]investmentinthedollaryieldsmorereturnsthanthatingold

4.Thephrase“rippedupM(Line1,Paragraph5)mostprobablymeansD.

[A]strengthened

[B]broadened

[CJrenegotiated

[D]tomup

5.Accordingtothepassage,theriseofgoldpriceB・

[A]willnotlastlong

fB]willattractsomecentralbankstosellgold

[C]willimpelcentralbankstoswitchintopapermoney

[D]willleadtoadollarcrisis

Unit5

Open-outcrytradingissupposedtobeaquaint,outdatedpractice,rapidlybeingreplacedby

sleeker,cheaperelectronicsystems.TrytellingthattotheNewYorkMercantileExchange

(NYMEX),theworld'slargestcommoditiesexchange.OnNovember1sttheNYMEXopenedan

open-outcrypitinDublintohandleBrentcrudefutures,thebenchmarkcontractforpricing

two-thirdsoftheworld'soil.

TheNYMEXistryingtosnatchliquidityfromLondon'sInternationalPetroleumExchange

(IPE),whichtradesthemostBrentcontracts;theNewYorkexchangehashithertoconcentratedon

WestTexasIntermediate,anAmericanbenchmarkgrade.ThenewpitisaresponsetotheIPE*s

effortstomodernise.OnthesamedayasNYMEXtradersstartedshoutingBrentpricesinDublin,

theIPEdidawaywithitsmorningopen-outcrysession:nowsuchtradesmustbeelectronic,or

doneinthepitafterlunch.

TheNewYorkexchangeclaimsthatcustomers,suchashedgefundsorenergycompanies,

preferopen-outcrybecauseitallowsformoreliquidity.Althoughmostotherexchangesare

headingintheoppositedirection,incommoditymarketssuchastheNYMEX,pressurefrom

"locals'1—self-employedtraders-ishelpingtopropupopen-outcry,althoughsomereckonthat

customerspayuptofivetimesasmuchaswithelectronicsystems.EventheIPEhasnoplansto

abolishitsfloor.Onlylastmonthitsignedalease,lastinguntil2011,foritstradingfloorin

London.

Dublin'snewpitis"showingpromise”,saysRobLaughlin,atraderwithManFinancial,

despiteafewtechnicalglitches.Onitsfirstdayithandled5,726lotsofBrent(eachlot,orcontract,

is1,000bairels),overathirdofthevolumeintheIPE'snewmorningelectronicsession.Bythe

year'send,predictsMrLaughlin,itshouldbeclearwhethertheventurewillbeviable.Itwould

standabetterchanceifitmovedtoLondon.Itmayyet:itstartedinIrelandbecauseregulatory

approvalcouldbeobtainedfastertherethaninBritain.

Ultimately,havingbothexchangesofferingsimilarcontractswillbeunsustainable.Stealing

liquidityfromanestablishedmarketleader,astheNYMEXistryingtodo,isahardtask.Eurex,

Europe'slargestfuturesexchange,setupshopinChicagothisyear,intendingtograbAmerican

Treasury-bondcontractsfromtheChicagoBoardofTrade.Ithasmadelittleheadway.Andthe

NYMEXhasdabbledinBrentcontractsbefore,withoutsuccess.

Giventheimportanceofliquidityinexchanges,whydotheIPEandtheNYMEXnotband

together?Therehavebeenmergertalksbefore,andsomethingmightyethappen.Somesaythat

thefreewheelingNYMEXandthemorestaidIPEcouldnevermix.Fornow,inanycase,thetwo

exchangeswillslugitout-acrosstheIrishSeaaswellasacrosstheAtlantic.

1.TheNYMEXandIPEareC.

[A]bothusingopenoutcrytradingasamajortradingform

[B]partnersthatarereciprocalintheirbusinessactivities

[CJrivalsthatarecompetingintheoiltradingmarket

fD]bothtakingeffortstomodernizetheirtradingpractice

2.Accordingtotheauthor,oneofthereasonsthattheNYMEXtakesopen-outcrytrading

is____A,

[A]thepreferenceofitscustomers

(Bjthestandardpracticeofenergyexchange

[C]thelongtraditionofthistradingpractice

[D]thenostalgicfeelingitarouses

3.Theword“glitches”(Line2,Paragraph4)mostprobablymeans__D.

fA]backwardness

fB]disappointments

[C]engineers

[D]problems

4.FromParagraph4wecaninferthat___B.

[A]tradingvolumeintheIPE'snewmorningelectronicsessionisfalling

fB]LondonisabetterbusinesslocationforenergyexchangesthanDublin

[CJBritain'sregulatorsarelessefficientthanthoseofIreland

[D]theDublinpitoftheNYMEXwillbemoreprosperousnextyear

5.WecandrawaconclusionfromthetextthatA,

[A]it'sveryunlikelythattheNYMEXandtheIPEcouldcombinetheirbusinesses

fB]theNYMEXwillfailinIrelandasmanyprecedentshaveshown

[C]thetwoenergyexchangeswillfigureoutawaytocooperatewitheachother

[D]themarketenvironmentforbothenergyexchangesisgettingbetter

Unit6

Thankstoslumpingmarkets,investmentbanksaresheddingmanyoftheirhighly-paid

traders.Whenmarketsrecover,thebanksmightbetemptedtoreplacethemwithrathercheaper

talent.Onealternativehasbeenaroundforawhilebuthasyettocatchon:autonomoustrading

agents-computersprogrammedtoactlikethehumanversionwithoutsuchpeskycostsasholidays,

lunchbreaksorbonuses.Programtradinghas,ofcourse,beendonebefore;someblamedthe1987

stockmarketcrashoncomputersinstructedwithsimpledecision-makingrules.Butrobotscanbe

smarterthanthat.

DaveCliff,aresearcheratHewlett-PackardLaboratoriesinBristol,England,hasbeen

creatingtradingrobotsforsevenyears.Incomputersimulationsheletsthemevolve"genetically",

andsoallowsthemtoadaptandfitmodelsofreal-worldfinancialmarkets.Hisexperimentshave

suggestedthataredesignofsomemarketscouldleadtogreaterefficiency.Lastyear,aresearch

groupatIBMshowedthatMrCliffsartificialtraderscouldconsistentlybeatthehumanvariety,in

variouskindsofmarket.Nearlyalltaketheshapeofanauction.Onewell-knowntypeisthe

Englishauction,familiartopatronsofthesalesroomsofChristie'sandSotheby's,wheresellers

keepmumontheirofferprice,andbuyersincreasetheirbidsbystagesuntilonlyoneremains.

AttheotherextremeistheDutchauction,familiarto17th-centurytulip-tradersinthe

NetherlandsaswellastobiddersforAmericanTreasurybonds.Here,buyersremainsilent,anda

sellerreduceshispriceuntilitisaccepted.Mostmarketsforshares,commodities,foreign

exchangeandderivativesareahybridofthesetwotypes:buyersandsellerscanannouncetheir

bidorofferpricesatanytime,anddealsareconstantlybeingclosed,aso-called"continuous

doubleauction".

MrCliffsnovelideawastoapplyhisevolutionarycomputerprogramstomarketplaces

themselves.Whynot,hethought,tryandseewhattypesofauctionwouldlettradersconverge

mostquicklytowardsanequilibriumprice?Theresultsweresurprising.Inhismodels,auctions

thatletbuyersandsellersbidatanytimelikemostoftoday'sfinancialexchangeswereless

efficientthanonesthatrequiredrelativelymorebidsfromeitherbuyersorsellers.These"evolved

auctions'1alsowithstoodbigmarketshocks,suchascrashesandpanics,betterthantoday's

real-worldversions.MrCliffsmostrecentresults,whichwillbepresentedinSydney,Australia,

onDecember10th,showthatthebesttypeofauctionforanymarketdependscruciallyoneven

slightdifferencesinthenumberofbuyersandsellers.

BankofAmericahasbeeninvestigatingthesenewauctions,alongwithrobotictraders,for

possibleuseinelectronicexchanges.Thehopeisthattoday'sfinancialauctionsandonline

marketplacesmightworkbetterbybecomingmoreliketheirEnglishandDutchforebears.But

whattocallsuchmulti-ethnichybrids?Here*sintroducingthe''Cliffhanger".

1.Thepassageismainly___B・

[A]areviewoftwokindsofauctions

[B]anintroductionoftradingrobots

[C]asurveyofthetradingmarket

[D]abouttradingalternatives

2.Whichofthefollowingistrueaccordingtothetext?C

[A]David'srobottradershavenowbeenusedinreal-worldmarkets.

[B]Robottraderscanevolvelikecreatures.

[C]Thereisroomforimprovementinefficiencyintradingmarkets.

[D]TheEnglishauctionisthemostpopulartradingform.

3.IfyouweretradingAmericanTreasurybonds,youwouldmostlikelytakethetrading

formof___C___.

[A]theEnglishauction

[B]thecontinuousdoubleauction

[C]theDutchauction

[D]theevolvedauction

4.WecaninferfromthetextthatB.

[A]existingauctionscannotwithstandmarketshocks

fB]theDutchauctionisbetterthanthecontinuousdoubleauction

[C]it'shardfortraderstoreachanequilibriumprice

[D]thebesttypeofauctiontakesplacewhenthenumberofthebuyersisequaltothatofsellers

5.Towardrobottraders,thewriter'sattitudecanbesaidtobeD.

[A]biased

[B]objective

[C]pessimistic

[D]optimistic

Unit7

TheIndianfinanceministry'smid-yearreview,releasedthisweek,seestheexternalsectoras

asilverliningaroundthecountry'shugefiscaldeficit."Buoyant"and"encouraging"arethewords

usedtodescribethreeconsecutivequartersofcurrent-accountsurplus—thefirstina

quarter-century.Addtothatswellingforeign-exchangereservesandastrongerrupee,andsome

arearguingthatitistimefordrasticliberalisationofIndia'sforeign-exchangeregime.Theycould

bedisappointed.

Formostofthepastdecade,thenominalvalueoftherupeehasbeenallowedtodecline

gentlyagainstthedollar,byabout5%ayear,thusstayingfairlysteadyinrealterms.Thisyear,

however,ithasbeenappreciatinginrealterms(and,sinceJune,nominallyaswell).Itwouldhave

donesomoresharplyhadthecentralbanknotbeenbuyingdollarswithgusto.Exportersof

manufacturedgoods,obsessedwithpricecompetitionfromChina,areaghastattherise—andatthe

prospectheldoutbysomeforecastersthatasustainedboominIndia*sITexportsmeansitwill

continue.

Therupee'srecentstrengthisonlypartlyrelatedtoIndia'sprowessinsoftwareandthe

mushroomingof"business-processoutsourcing"insuchprojectsascall-centres.Thechunky

surplusoninvisiblesowesmoretoremittances:non-residentIndians,attractedbythestabilityof

therupeeanditshigherinterestrates,havebeenmovingtheiroffshoredepositsback.home.

Similarly,Indiancompaniesareborrowingmoreindollarswithoutsellingrupeesforwardto

hedgerepayments.Thetradedeficit,meanwhile,hasbeenshrinking,asimportsgrowslowly.

Theinflowshaveboostedforeign-exchangereservesbysome$20billionthisyear,to$66

billion,or12months'-worthofimports.Thesizeofthiscushionhastriggeredsomecallsfor

furtherliberalisationofthelabyrinthineforeign-exchangecontrolsthatIndiastillmaintains,

despitethemovein1993towardsrupeeconvertibilityfortradepurposes.Inrecentmonths,some

controlshavedulybeeneased.Itisnowsimpler,forexample,forindividualstoopen

foreign-currencybankaccounts,andfortravellerstogetholdofforeignexchange.And

non-residentIndianshavebeenallowedtotakeoutmoneyacquiredthroughinheritance,orfrom

rentsanddividends.

Somecommentatorshavetakenallthisasaharbingeroffullcapital-accountconvertibility.

Thatisnotonthecards.Theexperienceof1991,whenIndiaranoutofmoney,hasleftthecentral

bankpronetocaution—anapproachitfeltwasvindicatedbytheEastAsiancrisisof1997-98.With

warinIraqloomingandaturbulentoilmarket,someriskaversionisunderstandable.