hard · SAT Reading & Writing
In his study of the 'resource curse,' economist Jeffrey Sachs examined why nations with an abundance of natural resources—such as oil or minerals—often experience slower economic growth than resource-poor countries. Sachs argues that a reliance on raw material exports can lead to 'Dutch Disease,' where a surge in currency value makes other sectors, like manufacturing, less competitive globally. Furthermore, the volatility of commodity prices can create a cycle of 'boom and bust' that hampers long-term investment.
Which choice best describes the overall structure of the text?
- It compares the manufacturing sectors of several different resource-rich nations.
- It presents a counterintuitive observation and outlines two mechanisms that might explain it.
- It argues that natural resources are the most important factor in determining a nation's wealth.
- It traces the historical development of 'Dutch Disease' from the twentieth century to the present.
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