UPSC Prelims 2014 · CSAT
Question 47: Reading Comprehension
“Price is not the same thing as value. Suppose that on a day the price of everything viz., coal, bread, postage stamps, a day's labour, the rent of houses, etc. were to double. Prices then would certainly rise, but values of all things except one would not.”
The writer wants to say that if prices of all things were doubled
AnswerUPSC’s answer is (d).
The writer separates price from value. If the money price of everything doubled, goods and services would not become more valuable, since the same things serve the same purposes and exchange for one another in the same ratios. The one thing whose value changes is money, which now buys only half as much as before. So only the value of money is halved.
Why each option is right or wrong
- (a) Values of all things stay constant except one, money, so saying all is wrong.
- (b) Doubled prices do not double the values of things sold; the things exchange in the same ratios.
- (c) The values of things bought do not halve; it is the purchasing power of money that halves.
- (d) Right. Only money's value is halved.
Answer: UPSC’s key. Explanation: written by UPSC Grade, not by UPSC.
Source: UPSC, Civil Services (Preliminary) Examination 2014, General Studies Paper II (CSAT), Series A. The paper on upsc.gov.in.