Question:
The newest hotel zone is due west of the city along the coast, stretching for 5 km (3 miles) or so before the coast bends on the way to the small town, Camara de Lobos, and the high cliff, Cabo Girao.

Does it follow that "About 3 miles up the coast is the small town of Camara de Lobos."?
Answer:
yes

Question:
They were too limp, too waxen to be pretending.

Does it follow that "They had pretended the first time, but not this time around."?
Answer:
it is not possible to tell

Question:
how could how could could you stand there and watch them beat that guy if your brother or your sister were being beaten

Does it follow that "You did nothing as he was being beaten."?
Answer:
yes

Question:
It houses the Naval Museum with a collection of relics from the French Naval sojourn here in 1798.

Does it follow that "The Naval Museum contains old weapons and items of clothing."?
Answer:
it is not possible to tell