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Practice verbal reasoning tests – blogpost 2 (business)



This is second in a daily series of blogposts giving practice at verbal reasoning tests for law students. Everyday we choose a new subject topic. Today it’s business. You may well have to do an online verbal reasoning test (psychometric test) as part of your training contract application.

In a verbal reasoning test, you are usually provided with a passage of information and required to evaluate a set of statements by selecting one of the following possible answers:

A – True (The statement follows logically from the information or opinions contained in the passage)

B – False (The statement is logically false from the information or opinions contained in the passage)

C – Cannot Say (Cannot determine whether the statement is true or false without further information)

In the example below, give your answer to each question by clicking on either A, B or C. You will be told whether your answer is correct or not.

Passage:

Over 60 years ago, evolutionary biologist Bernhard Rensch calculated that males are typically the larger sex in big-bodied species such as humans, whereas females outdo them in small-bodied species such as spiders. Now it turns out that many plants obey Rensch’s rule too. Most plants produce both male and female sex organs, but around 7 percent are dioecious, meaning individuals are purely male or female. Recent results provide that female stems also must be large enough to display the fruit and support the animals that spread the pollen or seeds. If metabolism, predators or climate promote the evolution of smaller plants, however, males can shrink because their gametes are smaller. 

The questions might be as follows.

1. Over 80 years ago, Bernard Rensch calculated that males are typically the larger sex in big-bodied species.

CANNOT SAY – the passage says that Bernard Rensch calculated this over 60 years ago, but it is not possible to say from the passage whether he calculated this over 80 years ago.

2. Around 7% of plants are dioecious, but it is not necessary for female stems to be large enough to display the fruit.

FALSE – whilst the first part of the statement is true according to the passage, the second part of the statement is clearly false, making the entire statement false.

 

So what’s the best way to prepare for your verbal reasoning test?

You are advised to practice any available good-quality example questions, and any books you can get your hands on with similar questions, and read our advice here. If you prepare properly for your test you will have nothing to worry about. Being prepared and knowing what to expect in your verbal reasoning test will go a long way to helping you perform your best. These verbal reasoning tests used by employers in their selection process aim to measure your ability to read, comprehend and interpret written information. Verbal reasoning tests are designed to test your powers of comprehension and logic.

You will be tested on whether you jump to conclusions or you appreciate the limitations of a statement. If a passage says “it has been reported…” it does not follow that the fact is necessarily true, only that it has been reported. Another classic example is: “if the lights in a house come on, does that mean there is someone inside the building?” Not necessarily.

“If A is bigger than B, does that mean B is small?” Not necessarily. You will be tested to sort fact from inference, a lot like what’s required in a real work environment. You can therefore see why lawyers almost always have to pass a verbal reasoning test.

Through practice, you will develop your own technique for answering verbal reasoning questions to the best of your ability, however for most people the best way to approach them is to read the entire passage through once, then turn to the questions. Read the first statement and refer back to the relevant part of the passage to carefully consider if the statement is true, false, or impossible to determine without further information. It will often come down to just one or two sentences within the passage.

You should have an idea of how much time to allow yourself for each question and know when to move on. Concentration is essential, especially when every second counts.  Base your answers on only the information contained in the passage. This is crucial, and if you don’t do this you will probably get a lot of the questions wrong. Verbal reasoning tests are not tests of what you know, they are tests of how well you understand written information.

 

PASSAGE

Barclays management has suffered a significant revolt by shareholders, after 26.9% of those who voted, said no to the company’s executive pay package. The vote came after Barclays’ chairman, Mr Marcus Aguis, apologised for the firm’s failure to communicate over the issue. His speech at the annual general meeting (AGM) prompted heckles and mocking laughter from shareholders, some of whom have been angered by high pay. It is one of the biggest shareholder rebellions of recent history. Including those abstaining, the result showed 32% of shareholders refused to back the company’s remuneration report. “There is a significant minority of shareholders who feel that we got some of these judgements [on remuneration] wrong for 2011 and that we have not sufficiently taken their views on board,” Mr Agius said at the bank’s annual meeting.

Mr Aguis was speaking at an extraordinary general meeting.

FALSE. Mr Aguis was speaking at an AGM.

The article refers to one of the biggest shareholder rebellions of recent history.

TRUE. This is clearly stated in the fourth sentence of this passage.

 

PASSAGE

Two of the UK’s biggest banks have admitted denying some customers their right to cancel recurring payments. Customers seeking to cancel “continuous payment authorities”  have been told by banks such as Lloyds TSB and Santander that only the Payee can agree such action. Since 2009, banks have been legally required to cancel CPAs when a customer asks. Two different parties are involved, payor and payee. Customer guidance from Lloyds and Santander did not reflect this. The new rights were enshrined in the Payment Services Regulations, which came into force in November 2009, but have been subject to ongoing discussions between the banks and the Financial Services Authority (FSA). As a bank customer, you have the right to cancel one of these continuous payment authorities and you can go to your bank, they can’t put up any hurdles, but in practice, some are being denied this right.

Only the Payor can agree to continuous payment authorities.

FALSE. Only the Payee can agree to such action. The Payor is never the Payee.

In practice, some are being denied the right to cancel one of these continuous payment authorities.

TRUE. This is a clear conclusion from the final two sentences of this Passage.

 

PASSAGE

 

 

 

 

 

 

 

Samsung Electronics has overtaken Nokia to become the world’s largest maker of mobile phones. Nokia took the top spot in 1998 from Motorola, but in the first quarter of 2012 Samsung shipped 93m phones compared to almost 83m by Nokia. Samsung also reported its highest quarterly profit since 2008. Net profit was 5.05tn won ($4.5bn; £2.8bn) in the quarter ending 31 March, up 81% from 2.78tn won last year. Samsung is also the world’s biggest TV and flat screen maker. The firm said its IT and mobile communications division, which manufactures the smartphones, made an operating profit of 4.27tn won during the period, as revenues in the division surged 86% from a year earlier. The Galaxy range has been very popular and helped Samsung overtake Apple to become the world’s biggest seller of smartphones.

Nokia has been the world’s largest maker of mobile phones.

TRUE. This is a correct conclusion from the first sentence.

During the first quarter of 2012, Nokia shipped around 10m phones more than Samsung.

FALSE. The Passage states the opposite in fact.

 

PASSAGE

US carmaker Ford has reported lower quarterly profits following weak sales in Europe and higher tax charges. Ford said about half the drop was due to it paying a higher tax rate. Ford made a loss of $149m in Europe where many economies are struggling. The carmaker’s sales in Europe were down by 60,000. Ford also reported losses in Asia, Africa and South America. However, in North America pre-tax profits rose 17% to $2.1bn, which was its best performance in the region since 2000. The company’s results contrast with others this week from leading car firms. Volkswagen, Daimler, Honda, Hyundai and Chrysler all reported an increase in profits for this quarter. Ford has also been boosting its manufacturing capacity in China, as part of its effort to raise global sales by nearly 50% to about 8 million cars by 2015.

The fall in profits also affected Ford in Europe.

TRUE. This is stated in the third sentence.

Volkswagen reported a decrease in profits for the quarter being discussed.

FALSE. The passage states the opposite in the penultimate sentence.

 

PASSAGE

Lloyds Banking Group (LBG) has said it has ended its exclusivity agreement with the Co-operative Group over the sale of 632 bank branches. The Co-op had entered exclusive talks over the sale of the branches in December, but Lloyds will now also consider talks with rival suitors. Earlier this month, banking venture NBNK put forward a fresh bid proposal for the branches. Lloyds has to sell the branches for regulatory reasons. Lloyds – which is 40%-owned by the government – has a deadline of November 2013 to complete the sale in order to meet European Commission competition rules. Given the renewed interest in the Verde business shown by NBNK, LBG will now consider detailed discussions with other parties but only once LBG is satisfied that any proposal is likely to achieve the appropriate regulatory clearances.

It is optional for LBG to sell these branches.

FALSE. LBG “has to sell the branches for regulatory reasons”.

40% of Lloyds is owned by the Government.

TRUE. This is stated in the Passage.

 

 

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