LSAT 148 | Section 2 | Reading Comprehension: Q19

RC Question 19 Explanation

DISCUSSION: This question asks about lines 11-14 and lines 40-42. To answer this question, you absolutely must read the two lines to see how they compare.

• Both lines mention using superior skill and analysis to profit in the stock markets
• However, passage A points out that the result of this analysis is information. Information that only you have.

Passage A is thus making an analogy between stock analysis and insider trading. Passage B thinks it is different: they present lines 40-42 as good ways to trade stocks, and say that insider trading as bad.

___________

1. Passage A doesn’t think stock information is unnecessary. In lines 8-10 they say “the entire field of stock brokering is based on” getting information others don’t have.
2. Passage A doesn’t mention stock market transparency. Only passage B uses this concept.
3. Both parts of this are wrong. Passage A doesn’t seem to think any information advantage is unfair: they’re arguing for insider trading after all. Passage B doesn’t mention insider trading as being a factor contributing to transparency. They focus on eliminating insider trading as a way to increase transparency. (Indeed, lines 43-45 start with “In a transparent stock market”), implying that the author thinks that lead of insider trading leads to transparency, and that leads to the ability to use skill in analysis.)
4. CORRECT. See the analysis above. Passage A points out that market skill leads to information advantages. This is very clear in lines 6-14.
    
   In passage B, the first paragraph makes clear that trading based on skill is good: it says “success is based on individual merit and skill” (lines 43-45). Insider trading, by contrast, is painted as something that “unfairly compromises” the market (line 50).
5. This is a trap. Passage A mentions that the field of brokering is based on analysis. But they didn’t say that only brokers can do this. Anyone who can “analyze a stock, decide if it is overvalued, and sell it” can trade stocks based on private information.