Question

Two statements are given followed by two conclusions I and II. Take the statement to be true and then decide which of the conclusions logically follows. Mark your answer accordingly
Statement :
A study of Planning Commission reveals boom in revenues. However, this has been of little avail owing to soaring expenditure. In the event, there has been a high dose of deficit financing, leading a marked rise in prices. Large financial outlays year after year had little impact on the level of living.
Conclusions:
I. A boom in revenues leads to rise in prices.
II. Large financial outlays should be avoided.

• A. only conclusion I follows
• B. only conclusion II follows
• C. either conclusion I or II follows
• D. neither conclusion I nor II follows

Answer 1

The Correct Option is D

To analyze the statement and the conclusions:

Statement:
A study by the Planning Commission reveals a boom in revenues. However, this has been of little avail owing to soaring expenditure. In the event, there has been a high dose of deficit financing, leading to a marked rise in prices. Large financial outlays year after year had little impact on the level of living.

Conclusions:
I. A boom in revenues leads to a rise in prices.
II. Large financial outlays should be avoided.

Analysis:
- Conclusion I: A boom in revenues leads to a rise in prices.
 The statement indicates that there has been a rise in prices due to deficit financing and soaring expenditure, not directly due to the boom in revenues. Therefore, this conclusion does not necessarily follow.

- Conclusion II: Large financial outlays should be avoided.  
 While the statement mentions that large financial outlays have had little impact on the level of living, it does not explicitly state that they should be avoided. This is more of a subjective recommendation rather than a direct conclusion drawn from the statement.

Conclusion:
Since neither conclusion follows logically from the statement, the correct answer is D: If neither conclusion I nor II follows.