Question : Assertion (A): To gear up the decreasing demand in the economy, RBI recently reduced Repo Rate and Bank Rate.
Reason(R): By decreasing the repo rate and bank rate the commercial banks reduce the rate of interest rate and thus it leads to an increase in demand for credit because of which more money flows into the system, purchasing power of people increases. Thus, aggregate demand rises and deficient demand is corrected.
Option 1: Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation of Assertion (A)
Option 2: Both Assertion (A) and Reason(R) are true, but Reason (R) is not the correct explanation of Assertion (A)
Option 3: Assertion (A) is true, but Reason (R) is false.
Option 4: Assertion (A) Is false, but Reason (R) is true.
Correct Answer: Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation of Assertion (A)
Solution : The correct answer is (a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
The assertion is true as the central bank often uses monetary policy tools like Repo Rate and Bank Rate to influence borrowing costs and stimulate economic activity.
The reason provided explains the mechanism behind this action. When the central bank decreases the Repo Rate and Bank Rate, it effectively reduces the rate of interest, making borrowing cheaper for commercial banks. This, in turn, leads to an increase in demand for credit, as it becomes more affordable. As more money flows into the system and purchasing power of people increases, aggregate demand rises, helping to correct deficient demand.
Therefore, both the assertion and reason are true, and the reason correctly explains the rationale behind the action taken by RBI.
Question : Assertion (A): A single cropping system was replaced by a multi-cropping system as a result of crop diversification. Reason (R): Due to a rise in market risk brought on by price fluctuations, it decreased farmers' revenue.
Option 1: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
Option 2: Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).
Option 3: Assertion (A) is true but Reason (R) is False
Option 4: Assertion (A) is False but Reason (R) is true.
Question : Assertion: Planning in India is primarily focused on promoting quick, balanced economic growth that is inclusive and just. Reason: It is widely believed that poverty and unemployment are the main obstacles to India's development.
Option 1: Both Assertion (A) and Reason (R) are True and Reason (R) is the correct explanation of Assertion (A)
Option 2: Both Assertion (A) and Reason (R) are True and Reason (R) is not the correct explanation of Assertion (A)
Option 3: Assertion (A) is True but Reason (R) is False
Option 4: Assertion (A) is False but Reason (R) is True
Question : Assertion (A): High levels of human capital imply not only high earning potential but also a shift in the social and economic landscape. Reason (R): It alters one's style of thinking and enables one to come to informed and logical judgments.
Question : Assertion: Inflation can worsen the poverty situation in a country.
Reason: Rising prices erode the purchasing power of the poor, making it difficult to afford essential goods and services.
Option 1: Both assertion and reason are true, and the reason is the correct explanation of the assertion.
Option 2: Both assertion and reason are true, but the reason is not the correct explanation of the assertion.
Option 3: Assertion is true, but the reason is false.
Option 4: Assertion is false, but the reason is true.
Question : Assertion: A tall organizational structure can lead to delays in decision-making.
Reason: It involves several layers of management between top-level and lower-level employees.
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