CAT 2024 Slot 3 — VARC Question 13
The passage below is accompanied by four questions. Based on the passage, choose the best answer for each question.
Moutai has been the global booze sensation of the decade. A bottle of its Flying Fairy which sold in the 1980s for the equivalent of a dollar now retails for $400. Moutai’s listed shares have soared by almost 600% in the past five years, outpacing the likes of Amazon. . . .
It does this while disregarding every Western marketing mantra. It is not global, has meagre digital sales and does not appeal to millennials. It scores pitifully on environmental, social and governance measures. In the Boy Scout world of Western business it would leave a bad taste, in more ways than one.
Moutai owes its intoxicating success to three factors—not all of them easy to emulate. First, it profits from Chinese nationalism. Moutai is known as the “national liquor”. It was used to raise spirits and disinfect wounds in Mao’s Long March. It was Premier Zhou Enlai’s favourite tipple, shared with Richard Nixon in 1972. Its centuries-old craftsmanship—it is distilled eight times and stored for years in earthenware jars—is a source of national pride. It also claims to be hangover-proof, which would make it an invention to rival gunpowder....
Second, it chose to serve China’s super-rich rather than its middle class. Markets are littered with the corpses of firms that could not compete in the cut-throat battle for Chinese middleclass wallets. And the country’s premium market is massive—at 73m-strong, bigger than the population of France, notes Euan McLeish of Bernstein, an investment firm, and still less crowded with prestige brands than advanced economies. Moutai is to these well-heeled drinkers what vintage champagne is to the rest of the world.....
Third, Moutai looks beyond affluent millennials and digital natives. The elderly and the middleaged, it found, can be just as lucrative. Its biggest market now is (male) drinkers in their mid30s. Many have no siblings, thanks to four decades of China’s one-child policy—which also means their elderly parents can splash out on weddings and banquets. Moutai is often a guest of honour.
Moutai has succeeded thanks to nationalism, elitism and ageism, in other words—not in spite of this unholy trinity. But it faces risks. The government is its largest shareholder—and a meddlesome one. It appears to want prices to remain stable. Exorbitantly priced booze is at odds with its professed socialist ideals. Yet minority investors—including many foreign funds —lament that Moutai’s wholesale price is a third of what it sells for in shops. Raising it could boost the company’s profits further. Instead, in what some see as a travesty of corporate governance, its majority owner has plans to set up its own sales channel.....
In the long run, its biggest risk may be millennials. As they grow older, health concerns, worklife balance and the desire for more wholesome pursuits than binge-drinking may curb the “Ganbei!” toasting culture [heavy drinking] on which so much of the demand for Moutai rests. For the time being, though, the party goes on.
The passage given below is followed by four alternate summaries. Choose the option that best captures the essence of the passage.
Humans have managed to tweak the underlying biology of various plants and animals to produce high-tech crops and microbes. But regulating these entities is complicated, as the framework of policies and procedures are outdated and not flexible enough to adapt to emerging technology. The question is whether regulation will ever be able to keep up with human innovation, to regulate living things, which are apt to be unpredictable and unique; to capture all the potential risks when new biological entities are introduced, or when they pass on variations of their genes?
Answer & solution
- A
The mercurial nature of biological entities calls for scientists to shape the regulations governing emerging technology, with regular calibration to handle variations in the field.
- B
The problem with formulating regulation for innovation in the scientific arena it that it is impossible to imagine the outcomes or risks related to the outcomes of all the research.
Current regulation of biotechnology is outdated, but it is debatable if we can create a framework, imaginative and flexible, to cover all contingencies in this fast-changing area.
- D
A new framework of rules and procedures for regulating the most recent research emerging from biotechnology is urgently needed, to keep up with this rapidly changing discipline.
Medium
The passage's essence: current regulation of bio-engineered entities is outdated/inflexible, and it poses an open question — can regulation ever keep up, given living things are unpredictable, to capture all risks? Keep both the "outdated" diagnosis and the unresolved "can we ever" doubt.
Why wrong. It prescribes that scientists should shape regulations with "regular calibration" — a confident solution the passage never offers. The passage raises a doubt, it doesn't propose this fix.
Why wrong. "it is impossible to imagine the outcomes" is too absolute; the passage poses it as a question ("whether regulation will ever be able to keep up"), not a flat declaration of impossibility, and omits the "outdated framework" point.
Why right. "Current regulation of biotechnology is outdated, but it is debatable if we can create a framework, imaginative and flexible, to cover all contingencies in this fast-changing area." This captures both halves exactly: the outdated diagnosis and the open, debatable question of whether adequate regulation is achievable.
Why wrong. It turns the passage's doubt into a confident call to action ("urgently needed"), dropping the central uncertainty about whether such regulation is even possible.
Correct answer: Option 3.