|Direction: Each of the next nine questions consists of two statements, one labeled as assertion (A) and other as Reason (R). You are to examine these two statements carefully and select the correct answers.|
|Assertion (A) During inflation, there is increase in money supply and rise in price level.|
|Reason (R) The rise in prices is due to shortage in supply of essential consumer goods.|
A) Both A and R are true and R is the correct explanation of A
B) Both A and R are true, but R is not the correct explanation of A
C) A is true, but R is false
D) A is false, but R is true
Correct Answer: D
Solution :The Assertion (A) that during inflation there is an increase in money supply and rise in price level is false. The Reason (R) that the rise in prices is due to shortage in supply of essential consumer goods is true.
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