1 .

Direction (Q. 1 - 10) : Read the following passage carefully and answer the questions given below it. Certain words/phrases are printed in bold to help you locate them while answering some of the questions.
Keynes once remarked how inane huinans were to dig gold from one corner of the earth and bury it in a vault in another corner. For millennia, housewives, speculators and governments have hungered for gold, regarding it as a unique commodity that would retain its value in all circumstances, making it the safest of safe investments. Now the glitter is wearing off. The world price of gold has just slumped below $300 per ounce. down from $500 in the mid-1980s. Those who bought gold as a safe investment are looking pretty silly. Gold is obsolete as an investment. When banking and financial instruments were underdeveloped, when war and hyperinflation were common, gold represented an insurance policy in a disaster. Insurance policies do not represent good investment, especially in modern times when life is less uncertain. The US dollar was linked to gold ($35 to the ounce) tili 1970, when President Nixon set it free. It soared after years of repression, convincing everybody that it was a tlne investment. Yet the US move had actually sealed its long-term doom. The IMF began selling its gold reserves in the mid-1970s, to finance a Special Development Fund. Several other central banks gradually sold some gold. Speculators still produced occasional bull runs, yet the long-term decline asserted itself. As this became increasingly evident, fewer and fewer peoples and governments built up gold hoards. and so the downward drift was accentuated. The Swiss government's decision to dispose of most of its gold reserves has sparked the tatest fall in price. and it will not be the last.
We are delighted. The Indian appetite for gold remains enormous. Smuggling plus legal Imports amount to perhaps $4 billion per year, a huge diversion of precious savings of the nation. This will diminish only when it becomes clear that gold is a lousy investment. The downward drift of world gold prices has been cloaked in india by rupee depreciation. Yet, at some point, even illiterate villagers will realise that a post office savings account yields considerably more than an investment in gold. At that point, Indians will finally recognise that gold may have decorative value but no investment value. Then alone will gold fever be cured.

According to the passage, investment in gold

A.  is not too paying an investment.
B.  yields huge dividends.
C.  should be seen from the viewpoint of a housewife.
D.  necessitates investment in securities.
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2 .

Investment in gold dates back to

A.  mid-1970 s
B.  the last six decades
C.  the last five centuries
D.  thousands of years
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3 .

Why is gold regarded as a safe investment ?

A.  War and hyperinflation are common.
B.  Life is not too certain.
C.  The author believes that the down slide in its prices is only temporary.
D.  People think its value does not diminish even in adverse circumstances.
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4 .

What does the sentence "Now the glitter is wearing off" mean ?

A.  The shine of most of the gold across the globe has diminished.
B.  People have begun to realise that gold does not retain its brightness.
C.  Gold is no more the safe investment it used to be.
D.  Selling gold has become a tough job.
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5 .

According to the passage. what has been the change in the world price of gold since then ?

A.  An increase of about 20%
B.  A decrease of about 20%
C.  A decrease of about 200%
D.  None of these
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6 .

Which "insurance policies" (see bold type in the passage) are being talked about in the passage ?

A.  Life insurance policy
B.  General insurance policy
C.  Either (1) or (2)
D.  Neither (1) nor (2)
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7 .

Which of the following triggered off the sale of gold by various countries ?

A.  The Statement of Keynes
B.  Theen dof World War II
C.  The de-linking of the US dollar from gold
D.  The IMF decision to seil its gold reserves
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8 .

The first sentence of the second paragraph says: "We are delighted." What do you think is the cause of this delight ?

A.  We have realised that it is no use buying gold.
B.  The world price of gold has fallen.
C.  Gold retains its value in all circumstances.
D.  Our savings have increased.
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9 .

Why has the author mentioned "rupee depreciation" ?

A.  Io contrast with it our appetite for gold
B.  To show how smuggling can be beneficial
C.  To show why Indians have become the beneficiary of the gold slump
D.  None of these
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10 .

When. according to the passage. will the Indian's gold fever be cured ?

A.  The author does not give any precise time.
B.  lt will never be cured.
C.  When world gold prices reach a standstill
D.  When post office savings become lucrative
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