Home PYQs UPPSC UPPSC MCQs Prelims 1998 (GS Paper I)

Question

Assertion (A): The rate of inflation in India has come down in the last three years.
Reason (R): The country has received a large among of foreign capital during these years.

Select the correct answer from the codes given below:
Codes:

  1. Both A and R are true and R is the correct explanation of A
  2. Both A and R are true, but R is NOT the correct explanation of A
  3. A is true but R is false
  4. A is false but R is true

Answer:

Option B: Both A and R are true, but R is NOT the correct explanation of A

Detailed Solution:

The correct answer is “Both A and R are true, but R is NOT the correct explanation of A”.

While both statements are true, there is no direct causal relationship between the two. The inflow of foreign capital can influence various economic factors, but it is not the sole determinant of inflation. Other factors like monetary policy, supply-side issues, and global commodity prices also play a crucial role in influencing inflation rates.