GMAT Reading Comprehension - As Urbanization Continues to Accelerate

Reading Passage Question

As urbanization continues to accelerate, many urban areas in developing countries are becoming densely populated and choked with traffic and air pollution. This expanding urbanization coincides with the rise of a suburban middle class made up of professionals who commute into the urban core each day. This new class of workers, college educated and computer literate, has chosen to stay at home, instead of moving to North America or Europe for work. However, if developing countries cannot find a way to manage their traffic congestion, they risk losing out to those places that can. One solution is congestion pricing. This scheme, implemented in various forms by cities such as London and Singapore, charges drivers a fee to enter a given area during peak traffic times. By implementing congestion pricing, developing countries could reduce fuel consumption and air pollution, decrease the economic loss due to wasted time spent in traffic, and raise revenue that could be used to develop infrastructure such as mass transit.

Congestion pricing has proven to be more than just a form of traffic mitigation; it has made cities more livable. Since setting up its “Area Licensing Scheme” in the 1970s, Singapore has been transformed. Traffic jams have virtually disappeared as the number of vehicles entering the congestion pricing area has declined by 76%. Since 2003 when London introduced its system, average commuting times have declined by 14%. At the same time, public transportation usage and bicycle ridership have increased sharply in both cities and air pollution has been dramatically reduced.

Congestion pricing advocates characterize what has happened in London and Singapore as a “virtuous cycle”—a positive feedback loop with beneficial externalities. When drivers are charged a fee, many of them will choose to take public transportation or to bicycle instead. This reduces the number of vehicles on the road. At the same time, those who decide that it is worth it to drive and pay the fee will spend less time in stop and go traffic. Car drivers and bus passengers experience the benefit of reduced commuting times and both cars and buses waste less fuel idling in stalled traffic. Meanwhile, the money raised can be used to fund the expansion of public transportation and improvement of infrastructure such as roads and bicycle paths. These improvements in turn reduce commuting times and make it more convenient to take public transportation.

Critics have argued that congestion pricing could actually have the opposite effect of that intended. Citing an economic principle known as “induced demand,” they contend that the congestion pricing could become a victim of its own success. As traffic eases, driving becomes a more desirable option, thus leading to the same traffic problems as before. However, these critics forget that “there’s no such thing as a free lunch.” Congestion pricing forces drivers to bear the true economic costs of their actions. While some may choose to continue driving, that choice now comes with a price tag and the money raised will benefit those who choose not to.

Reading Passage Question:

‘As urbanization continues to accelerate’ is a GMAT reading comprehension passage with answers. Candidates need a strong knowledge of English GMAT reading comprehension.

This GMAT Reading Comprehension consists of 7 comprehension questions.

The GMAT Reading Comprehension questions are designed for the purpose of testing candidates’ abilities in understanding, analyzing, and applying information or concepts. Candidates can actively prepare with the help of GMAT Reading Comprehension Practice Questions.

Questions and Solutions

1. The passage suggests that the author believes traffic jams to

1. occur more frequently in developing countries than in North America or Europe
2. be an unavoidable result of urbanization
3. be the result of the principle of induced demand
4. influence characteristics of a city besides transportation
5. indicate that an urban area is developing a suburban middle class

2. Which of the following scenarios conforms most closely to the pattern described in the third paragraph?

1. A law designed to spur development of high-speed rail by limiting owner liability for accidents prompts companies to take fewer safety precautions, resulting in more frequent accidents, which reduces overall demand for high-speed rail.
2. An ordinance that prohibits cars from entering a park during the day causes more people to visit the park and reduces the number of accidents.
3. A cell phone company increases its capacity in order to meet increased demand for data due to the rising popularity of smartphones, which improves data transmission speeds and reliability, and prompts more people to buy smartphones.
4. A county plan to create technology jobs by convincing a software company to locate their results in local schools teaching more math and science, creating a better-educated workforce, which attracts other software companies to move there as well.
5. A bank's plan to increase its cash reserves by charging a fee to any account that does not carry a minimum balance leads to customers withdrawing their money, closing their accounts, and switching to a different bank.

3. The author most likely included the quotation "there's no such thing as a free lunch." (Highlighted) in order to

1. accuse the critics of congestion pricing of attempting to avoid paying their fair shares
2. state a well-known axiom that undermines the previously mentioned economic principle
3. indicate that critics of congestion pricing may have based their conclusions on insufficient information
4. offer a possible solution to the problem outlined in the previous sentence by the critics of congestion pricing
5. argue that an economic principle, while broadly applicable, is not relevant to transportation issues

4. The author would be most likely to agree with which of the following statements?

1. Congestion pricing is generally consistent with the economic principle of induced demand.
2. Cities that have implemented congestion pricing have not done so in a uniform manner.
3. Congestion pricing is the best solution available to developing countries facing traffic problems.
4. Cities that have implemented congestion pricing have generally been successful at reducing traffic.
5. Before implementing congestion pricing, London experienced frequent traffic jams.

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