Q34 to Q36:
Firms traditionally claim that they
downsize (i.e., make permanent personnel cuts) for economic reasons,Line laying off supposedly unnecessary staff
(5) in an attempt to become more efficient
and competitive. Organization theory
would explain this reasoning as an
example of the “economic rationality”
that it assumes underlies all organi-
(10) zational activities. There is evidencethat firms believe they are behaving
rationally whenever they downsize; yet
recent research has shown that the
actual economic effects of downsizing
organization theory cannot adequately
explain downsizing; non-economic
factors must also be considered.
One such factor is the evolution of
downsizing nowadays is greeted
favorably by the business press; the
(25) press often refers to soaring stockprices of downsizing firms (even though
research shows that stocks usually
rise only briefly after downsizing and
then suffer a prolonged decline).
downsizing is now viewed as a signal
that firms are serious about competing
are received positively by key actors
— (35) financial analysts, consultants,shareholders—who supply firms with
vital organizing resources. Thus, even
if downsizers do not become economi-
cally more efficient, downsizing’s mythic(40) properties give them added prestige
in the business community, enhancing
their survival prospects.
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Q34:
The primary purpose of the passage is to
A.criticize firms for engaging in the practice of downsizing
B.analyze the negative economic impact of downsizing on firms
C.offer an alternative to a traditional explanation for the occurrence of downsizing
D.chronicle how perceptions of downsizing have changed over time
E.provide evidence disputing the prevalence of downsizing
WHy the key is C but not D? Thanks!
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