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State PCS PYQPrelims 2021

UPPCS · Question 39

Given below are two statements, one labelled as Assertion (A) and the other as Reason (R). Assertion (A): The government faces a tough time tackling the bottleneck inflation. Reason (R): The situation is due to deficiencies existing in the economy such as supply bottleneck and inefficient distribution. Select the correct answer using the code given below.

  1. Both (A) and (R) are true and (R) is 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
Show answer & explanation

Answer: (A) Both (A) and (R) are true and (R) is correct explanation of (A)

Explanation

Bottleneck inflation stems from supply-side constraints that monetary tools cannot easily fix, which is why it is hard to tackle.