The question requires us to identify the correct inference. In the first paragraph, the passage mentions, "universal institutions such as the family, rituals, governance, economy, and the military. These are mostly institutions that just grew... In their present incarnations, however, they are very much the product of conscious attempts to mold and plan them." This contradicts option 1. The passage further states, "Culture and tradition are sub-sets of institutions analytically isolated for explanatory or expository purposes," refuting option 2. The statement, "Institutions deriving from statute, like joint-stock companies are formal by contrast with informal ones such as friendships," does not provide evidence supporting option 3. As option 3 cannot be inferred, it is a false inference. There is no correlation between the institution of friendship and joint-stock companies, except that one is formal while the other is informal. The last paragraph mentions, "Natural languages are typical examples of what Ferguson called ‘the result of human action, but not the execution of any human design,’" supporting option 4. Therefore, option 4 is the most appropriate choice.
The answer to this question can be found at the start of the first paragraph, though we need to examine closely what those two overlapping things are. The author, in the first paragraph, states, “We begin with the emergence of the philosophy of the social sciences as an arena of thought and as a set of social institutions. The two characterizations overlap but are not congruent”… From this sentence, it is clear that one of the characterizations is “social institutions”... This helps us eliminate options 1 and 2 because neither has the word ‘institutions’ or ‘social institutions’. Out of options 3 and 4, we can choose 3 because if one characterization is ‘social institutions’, the other is ‘an arena of thought’. What does the author mean by ‘an arena of thought’? It is not philosophy but an academic study. Hence, 3 is the best answer. We have to understand that it is the philosophy of social sciences that has two things: an arena of thought (academic discipline) and a set of social institutions.
To find the correct answer, we should refer to the part of the passage where the quote has been mentioned. The author states a fact with a specific purpose, which is to illustrate the interconnectedness of everything. The options guide us to the right answer. The examples of the stock exchange and black market are not presented for a detailed discussion of their technicalities; rather, they are used to emphasize a particular perspective, which aligns with option 4. This option is the most suitable answer because it encapsulates the broader point the author aims to convey through these examples — the coexistence of different institutions.
To answer this question, we have to consider the broader picture. Option 1 mentions ‘it is usual…,’ but whether something is usual or not is not the theme of the passage. Additionally, language and the stock exchange are not the central ideas. Option 4 is the best choice simply by elimination because right across the passage, the author discusses the importance of institutions. The last sentence of the paragraph says, “Above all, languages are paradigms of institutional tools that function to coordinate.”… Language is also considered an institution, but not the only institution.