Minimalist IAS
CSAT 2023 paper

UPSC CSE CSAT 2023 · Question 22 · Reading comprehension

Which of the following statements best reflects the logical inference from the passage given above?

Passage—2

Good corporate governance structures encourage companies to provide accountability and control. A fundamental reason why corporate governance has moved onto the economic and political agenda worldwide has been the rapid growth in international capital markets. Effective corporate governance enhances access to external financing by firms, leading to greater investment, higher growth and employment. Investors look to place their funds where the standards of disclosure, of timely and accurate financial reporting, and of equal treatment to all stakeholders are met.

CSAT 2023 · Q22

Reading comprehension Medium

Which of the following statements best reflects the logical inference from the passage given above?

Answer & explanation

Answer: (b) Good corporate governance improves the credibility of the firms.

Good governance brings accountability and control, and investors put money where disclosure, accurate reporting and fair treatment of stakeholders are assured, which is why such firms get easier external finance. The inference is that good governance makes firms more credible.

  • ✗ (a) The passage says corporate governance moved onto the global agenda; it does not say ensuring access to external financing is countries' agenda.
  • ✓ (b) Accountability, control, timely and accurate reporting and equal treatment are the standards investors trust, so good governance raises a firm's credibility and its access to funds.
  • ✗ (c) This reverses the link: the growth of capital markets is why governance became important; markets are not said to ensure good governance.
  • ✗ (d) Supply chains are not mentioned.

Remember · Watch for reversed cause and effect: an option that swaps the passage's cause and result is a classic trap.

Question and answer: UPSC's official GS Paper II (2023, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). ·

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