Step 1: Analyze ARP request behavior.
An ARP request is generated when a host knows the IP address of a destination
but does not know its MAC address.
Since the destination MAC address is unknown, the ARP request must be sent to all hosts in the local network.
Hence, an ARP request is sent as a broadcast frame, making statement S2 true.
Step 2: Analyze ARP reply behavior.
An ARP reply is sent by the host whose IP address matches the request.
At this point, the responder knows the MAC address of the requester (from the ARP request), so the reply is sent directly to that host.
Therefore, an ARP reply is a unicast frame, not a broadcast, making statement S1 false.
Final Conclusion:
S1 is false and S2 is true.
Final Answer: (C)