Choose the most appropriate option after reading the following statements.
I. Business schools are ideally positioned to point out when an action that provides a benefit for an individual comes at a cost to society, but in reality they rarely bother.
2. It is part of the malaise that has befallen the political debate on capitalism, which has been taken over by special interests and people who have no faith in a real market-based system.
3. When governments favours the private sector it is all too often by being "pro-business" rather than "pro-market", meaning that favourable conditions are provided to particular institutions rather than to institutions broadly.

Solution

The second statement starts with the pronoun 'it'. The third statement talks about the government favouring private sector. Therefore, the 'it' in the second statement most probably refers to the favours extended by the government. Sentences 2 and 3 are dependent. Sentence 1 talks about business schools and is unrelated to the remaining 2 sentences (which talk about the government and politics). Therefore, option B is the right answer.

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