Postage Stamps Have Followers In Every Strand Of Society GMAT Reading Comprehension

Reading Passage Question

Postage stamps have followers in every strand of society all over the world. As an alternative investment to more traditional markets, stamps have performed well, with high quality examples beating the return on most of the rest of the economy during low-interest rate periods. Stamps as an asset help a portfolio achieve diversification, so maximizing opportunity while minimizing risk. The market-makers are sometimes reported in the national press when they pay vast sums of money for examples of the world’s most expensive stamps. Particularly valuable are stamps that were misprinted, the most famous (and valuable) of which is perhaps the 1920s’ 24-cent American stamp with an upside-down biplane. Equally high prices are paid for examples of otherwise common stamps that carry unique differences. These variations may have been unintentional but their rarity sets them apart. In many instances, these differences are minuscule and what appears to the casual observer as an unremarkable example of an everyday stamp, is to the rich fanatic with a magnifying glass a highly valuable prize. For the vast majority of dealers and their customers, the celebrated super expensive stamps are the subject only of catalogs and magazine articles. Their domain is more likely to be the newly issued colorful commemorative stamps printed in the millions by national post offices. Thousands buy sheets of these stamps in the expectation that they will rise in value. All too often however, when the time comes to sell the collection they discover that the stamps are worth less than they were originally worth in terms of their posting value.

“Postage stamps have followers in every strand of society”- is a passage for the GMAT that addresses reading comprehension. Candidates must have a firm understanding of GMAT reading comprehension in English. This GMAT reading comprehension section consists of five comprehension questions. The purpose of the GMAT Reading Comprehension questions is to assess a candidate's capacity to understand, evaluate, and apply knowledge or ideas. By responding to the GMAT Reading Comprehension Practice Questions section, candidates can actively practice.

Solutions and Explanation

1. The primary objective of this passage is to:

1. promote stamps as an alternative investment to more usual investments such as the bond markets
2. describe philately, the hobby of collecting postage stamps
3. describe investing in stamps
4. describe the two worlds of philately: the small-time collector of decorative stamps with little real value and the international market of high-value, rare stamps
5. describe the two worlds of philately: the investor and the collector

2. In the context of the passage the word portfolio means:

1. a range of investments
2. a flat case for the safe transportation of stamps or other paper valuables
3. the duties of a minister of state
4. a sample of the items in a collection that demonstrate its extent
5. a set of stamps that collectively are worth more than they can command individually

3. Criminals sometimes use stamps to transport and launder large sums of money. Which of the features that make stamps attractive to criminals is not mentioned in the passage?

1. The casual observer is unlikely to realize the high value of some stamps.
2. There is a ready market for stamps in most countries.
3. There are stamp dealers all over the world.
4. A few stamps can be worth a large sum of money.
5. Their size and value makes them highly portable.

4. Which of the following statements, if true, would prove the case that the vast majority of collectors find their collections worth less than they originally paid for them?

1. The world’s most expensive stamps have doubled in value in the last 12 years.
2. Over the years, high-quality stamps have risen in value at a rate equal to the growth rate of the rest of the economy.
3. The collecting price for a stamp is determined more by rarity than original posting value.
4. Commemorative stamps from the 1940s command the best prices.
5. After decades, some new issues command higher prices for collecting than their original posting.

5. Which of the following motives is not mentioned in the passage?

1. obsessive enthusiasm
2. a means to diversify investments
3. the expectation that they will rise in value
4. to beat the return of other markets at a time of low interest rates
5. to collect them

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