| Directions : Read the following statements : Assertion (A) and Reason (R). Choose one of the correct alternative. |
| Assertion (A): There are two components of money supply, currency held by the public and Net demand deposits held by the commercial banks. |
| Reason (R): Money supply is a stock variable and refers to the stock of money held by public in spendable for i.e., money supply refers to the stock of money in circulation in an economy. |
A) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
B) Both Assertion (A) and Reason (R) are true but Reason (R) is not the correct explanation of Assertion (A).
C) Assertion (A) is true but Reason (R) is false.
D) Assertion (A) is false but Reason (R) is true.
Correct Answer: A
Solution :
[a] Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
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