Smith did not invent economics. Joseph Schumpeter observed that “The Wealth of the Nations” did not contain “a single analytic idea, principle or method that was entirely new”. Smith’s achievement was to combine an encyclopedic variety of insight, information and anecdote, and to distill from it a revolutionary doctrine. The resulting masterpiece is the most influential book about economics ever published. Remarkably, much of it speaks directly to questions that are still of pressing concern. The pity is that Smith’s great book, like most classics (of 900 pages), is more quoted than read. All sides in today’s debates about economic policy have conspired to peddle a conveniently distorted version of its idea. If his spirit is still monitoring events, it will undoubtedly have celebrated the collapse of communism. But it must also long to meet the politicians who have taken charge of a fine reputation and not so fine profile. And put them right on one or two points. Today Smith is widely seen as intellectual champion of self-interest. This is a misconception. Smith saw no moral virtue in selfishness; on the contrary he saw its dangers. Still less was he a defender of capital over labour (he talked of the capitalist’s “mean rapacity”), of the rising bourgeoisie over the common folk. His suspicion of self-interest and his regard for the people as a whole come through clearly in one of his best-known remarks: “People of the same trade often meet together, even have merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” Far from praising self-interest as a virtue, Smith merely observed it to be a driving economic force. In “The Wealth of Nations” he explained how this potentially destructive impulse is harnessed to the social good. What is to prevent greedy producers raising their prices until their customers cannot afford to pay no more? The answer is competition. If producers raise their prices too high, they create an opportunity for one or more among them to profit by charging less and thus selling more. In this way competition tames selfishness and regulates prices and quality. At the same time it regulates quantities. If buyers want more bread and less cheese, their demand enables bakers to charge more and obliges cheese-mongers to charge less. Profits in bread-making would rise and profits in cheese-making would fall; effort and capital would move from one task to the other.
Through Smith’s eyes, it is possible to marvel afresh at this fabulously powerful mechanism and to relish, as he did, the paradox of private gain yielding social good. Only more so, for the transactions that deliver a modern manufactured good to its customer are infinitely more complicated than those described by Smith. In his day, remember, the factory was still a novel idea: manufacturing meant pins and coats. A modern car is made of raw materials that have been gathered from all over the world, combined into thousands of intermediate products, sub-assembled by scores of separate enterprises. The consumer need know nothing of all this, any more than the worker who tapped the rubber for the tyres knows or cares what its final use will be. Every transaction is voluntary. Self-interest and competition silently process staggering quantities of information and direct the flow of good. Services, capital and labour — just as in Smith’s much simpler world. Far-sighted as he was, he would surely have been impressed. Mind you, modern man has also discovered something else. With great effort and ingenuity, and the systematic denial of personal liberty, governments can supplant self-interest and competition, and replace the invisible hand of market forces with collective endeavour and a visible input-output table. The result is a five-year waiting list for Trabants.
The author subtly suggests that
Show Hint
- there is a dual nature in man.
- there is dichotomy between man as an emotional being and man as a rational being.
- there should be no dichotomy between man as a rational being and man as an emotional being.
- man’s emotions cannot be understood.
The Correct Option is C
Solution and Explanation
The biological basis of choosing efficacy as value
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- cannot be understood easily.
- is the relationship of efficacy to survival.
- is the association of efficacy to pleasure.
- is the biological relationship to cognition.
The Correct Option is B
Solution and Explanation
The author defines value as
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- something that results as good.
- something that is chosen by man.
- that which gives pleasure over pain.
- that which increases efficacy.
The Correct Option is D
Solution and Explanation
The basic theme of the passage is that
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- man can choose his own values, irrespective of whether they are life sustaining or not.
- man chooses values that are life sustaining.
- values are given to man on account of his emotive process.
- emotions and rationality are derived from each other.
The Correct Option is B
Solution and Explanation
According to this passage, through which of the following set of experiences, does man first acquire preferences?
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- A
- A and B
- B and D
- C
The Correct Option is B
Solution and Explanation
Reason has the following basic functions:
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- Wisdom and judgement.
- Identifying what is beneficial to man.
- Identifying the nature of pleasure and its value.
- Cognition and evaluation.
The Correct Option is D
Solution and Explanation
The difference between a child’s and adult’s conceptual identification of issues relating to value is that
Show Hint
- the former experiences them through physical sensations.
- the latter experiences them through physical sensations.
- the latter’s is more volitional in nature.
- the adults’ choice is existential in nature.
The Correct Option is C
Solution and Explanation
According to the author, while man chooses his own values, it does not mean that
Show Hint
- he is always successful.
- it guarantees the basic reason for choosing them.
- they are incompatible with his needs.
- his environment has a say in it.
The Correct Option is B
Solution and Explanation
What man experiences as primary, according to the author,
Show Hint
- is questionable merit.
- changes overtime.
- is the value of pain and pleasure.
- is not debatable.
The Correct Option is C
Solution and Explanation
While a man can choose his values
Show Hint
- he is biologically programmed to choose those of survival.
- he is biologically programmed to choose those of destruction.
- his volitional consciousness can lead him to the wrong choice.
- his volitional consciousness leads him to the correct choice.
The Correct Option is C
Solution and Explanation
Top Questions on Reading Comprehension
- Shown below are letters ‘e’ taken from four popular logos, arranged in a sequence. Which of the options is the correct sequence?
- UCEED - 2026
- English Language Comprehension
- Reading Comprehension
- Shown below are four options, each showing consecutive frames representing the movement of a pendulum of an old-style wall clock for an animation movie. Which is the correct option?
- UCEED - 2026
- English Language Comprehension
- Reading Comprehension
- Acrucial moderating factor in how people experience comparisons is self-esteem. Individuals with high self-esteem are more likely to interpret upward comparison as informative rather than threatening. They are more resilient in the face of others’ success and more likely to believe they can reach their own goals. In contrast, people with low self-esteem are more prone to interpret comparison as judgment, reinforcing negative self-views and triggering feelings of inadequacy.
This dynamic creates a self-reinforcing loop. People with high self-esteem are less vulnerable to upward comparison, which intensifies those doubts. Those with a secure sense of self are more likely to use comparison as a learning tool. The same external stimulus—a colleague’s achievements, a friend’s popularity—can have radically different effects depending on internal stability.
Self-esteem also influences how people choose their comparison targets. Research has found that individuals often engage in “selective comparison,” seeking out those who confirm their existing beliefs about themselves. This can become a subtle form of self-sabotage. Someone who feels unworthy may subconsciously seek out targets that reinforce that sense, perpetuating a narrative of inferiority. One of the most promising antidotes to social comparison is temporal comparison—evaluating oneself not against others, but against one’s own past. This method has been shown to increase motivation and satisfaction, especially when individuals can see concrete progress. Temporal comparison activates the same reward circuits as social comparison but avoids the threat systems associated with social ranking. It also reinforces agency: individuals focus on what they can control and improve rather than what others control. In therapeutic and coaching settings, temporal comparison is used to help clients build self-efficacy and track growth over time.
Moreover, people who focus on self-improvement rather than social dominance are less likely to fall into cycles of envy or self-pity. They can still use others as inspiration, but they do so without attaching their self-worth to the outcome. This is not to say they never compare—but that they focus on learning, rather than judgment. The most skilful approach to comparison may lie in eliminating it, but in reframing it as feedback. When we interpret comparison as information rather than a verdict, we can ask, “What can I learn from this?” This shift turns comparison into a growth tool. Teachers mentor their students, not as rivals. Psychologists emphasize that the key variable here is mindset.
A fixed mindset sees comparison as a threat. If someone else is better, it means we are worse. A growth mindset sees comparison as a map. If someone else has reached a certain level, it means the path exists. This reframing is not just a cognitive trick. It changes the emotional tone of comparison, making it more likely to inspire than to wound. Reframing also requires emotional regulation—the ability to notice an initial pang of envy or shame without reacting impulsively. With practice, individuals can learn to pause, reflect, and reinterpret their emotional responses. Over time, this builds resilience and self-trust, allowing comparison to become a learning tool rather than a cage.- XAT - 2026
- Verbal and Logical Ability
- Reading Comprehension
When people who are talking don’t share the same culture, knowledge, values, and assumptions, mutual understanding can be especially difficult. Such understanding is possible through the negotiation of meaning. To negotiate meaning with someone, you have to become aware of and respect both the differences in your backgrounds and when these differences are important. You need enough diversity of cultural and personal experience to be aware that divergent world views exist and what they might be like. You also need the flexibility in world view, and a generous tolerance for mistakes, as well as a talent for finding the right metaphor to communicate the relevant parts of unshared experiences or to highlight the shared experiences while demphasizing the others. Metaphorical imagination is a crucial skill in creating rapport and in communicating the nature of unshared experience. This skill consists, in large measure, of the ability to bend your world view and adjust the way you categorize your experiences. Problems of mutual understanding are not exotic; they arise in all extended conversations where understanding is important.
When it really counts, meaning is almost never communicated according to the CONDUIT metaphor, that is, where one person transmits a fixed, clear proposition to another by means of expressions in a common language, where both parties have all the relevant common knowledge, assumptions, values, etc. When the chips are down, meaning is negotiated: you slowly figure out what you have in common, what it is safe to talk about, how you can communicate unshared experience or create a shared vision. With enough flexibility in bending your world view and with luck and charity, you may achieve some mutual understanding.
Communication theories based on the CONDUIT metaphor turn from the pathetic to the evil when they are applied indiscriminately on a large scale, say, in government surveillance or computerized files. There, what is most crucial for real understanding is almost never included, and it is assumed that the words in the file have meaning in themselves—disembodied, objective, understandable meaning. When a society lives by the CONDUITmetaphor on a large scale, misunderstanding, persecution, and much worse are the likely products.- XAT - 2026
- Verbal and Logical Ability
- Reading Comprehension
Later, I realized that reviewing the history of nuclear physics served another purpose as well: It gave the lie to the naive belief that the physicists could have come together when nuclear fission was discovered (in Nazi Germany!) and agreed to keep the discovery a secret, thereby sparing humanity such a burden. No. Given the development of nuclear physics up to 1938, development that physicists throughout the world pursued in all innocence of any intention of finding the engine of a new weapon of mass destruction—only one of them, the remarkable Hungarian physicist Leo Szilard, took that possibility seriously—the discovery of nuclear fission was inevitable. To stop it, you would have had to stop physics. If German scientists hadn’t made the discovery when they did, French, American, Russian, Italian, or Danish scientists would have done so, almost certainly within days or weeks. They were all working at the same cutting edge, trying to understand the strange results of a simple experiment bombarding uranium with neutrons. Here was no Faustian bargain, as movie directors and other naifs still find it intellectually challenging to imagine. Here was no evil machinery that the noble scientists might hide from the problems and the generals. To the contrary, there was a high insight into how the world works, an energetic reaction, older than the earth, that science had finally devised the instruments and arrangements to coart forth. “Make it seem inevitable,” Louis Pasteur used to advise his students when they prepared to write up their discoveries. But it was. To wish that it might have been ignored or suppressed is barbarous. “Knowledge,” Niels Bohr once noted, “is itself the basis for civilization.” You cannot have the one without the other; the one depends upon the other. Nor can you have only benevolent knowledge; the scientific method doesn’t filter for benevolence. Knowledge has consequences, not always intended, not always comfortable, but always welcome. The earth revolves around the sun, not the sun around the earth. “It is a profound and necessary truth,” Robert Oppenheimer would say, “that the deep things in science are not found because they are useful; they are found because it was possible to find them.”
...Bohr proposed once that the goal of science is not universal truth. Rather, he argued, the modest but relentless goal of science is “the gradual removal of prejudices.” The discovery that the earth revolves around the sun has gradually removed the prejudice that the earth is the center of the universe. The discovery of microbes is gradually removing the prejudice that disease is a punishment from God. The discovery of evolution is gradually removing the prejudice that Homo sapiens is a separate and special creation.- XAT - 2026
- Verbal and Logical Ability
- Reading Comprehension
Questions Asked in CAT exam
- The passage given below is followed by four summaries. Choose the option that best captures the essence of the passage.
In the dynamic realm of creativity, artists often find themselves at the crossroads between drawing inspiration from diverse cultures and inadvertently crossing into the territory of cultural appropriation. Inspiration is the lifeblood of creativity, driving artists to create works that resonate across borders. In a globalized era of the modern world, artists draw from a vast array of cultural influences. When approached respectfully, inspiration becomes a bridge, fostering understanding and appreciation of cultural diversity. However, the line between inspiration and cultural appropriation can be thin and easily blurred.
Cultural appropriation occurs when elements from a particular culture are borrowed without proper understanding, respect, or acknowledgment. This leads to the commodification of sacred symbols, the reinforcement of stereotypes, and the erasure of the cultural context from which these elements originated. It is essential to recognize that the impact of cultural appropriation extends beyond the realm of artistic expression, influencing societal perceptions and perpetuating power imbalances.- CAT - 2025
- Para Summary
- The number of distinct integers $n$ for which $\log_{\left(\frac14\right)}(n^2 - 7n + 11)>0$ is:
- CAT - 2025
- Linear Inequalities
- In the set of consecutive odd numbers $\{1, 3, 5, \ldots, 57\}$, there is a number $k$ such that the sum of all the elements less than $k$ is equal to the sum of all the elements greater than $k$. Then, $k$ equals?
- CAT - 2025
- Number Systems
- The number of distinct pairs of integers $(x, y)$ satisfying the inequalities $x>y \ge 3$ and $x + y<14$ is:
- CAT - 2025
- Number Systems
For any natural number $k$, let $a_k = 3^k$. The smallest natural number $m$ for which \[ (a_1)^1 \times (a_2)^2 \times \dots \times (a_{20})^{20} \;<\; a_{21} \times a_{22} \times \dots \times a_{20+m} \] is:
- CAT - 2025
- Linear Inequalities