Read the following statements: Assertion (A) and Reason (R). Choose the correct alternative from those given below:
Assertion (A): The equilibrium level of income is determined when ex-ante spending and ex-ante output are equal.
Reason (R): The equilibrium level of income may or may not be the same as the full employment level of output.
Assertion (A): The equilibrium level of income is established when planned spending aligns with planned output, preventing unintended inventory fluctuations.
Reason (R): The equilibrium income level does not inherently correspond to full employment output; it can exist at levels both below and above full employment, contingent on aggregate demand.
Conclusion: While both assertions are factually correct, the reason provided does not fully elucidate the mechanism of equilibrium determination as presented in the assertion.
Select the correct option based on the provided statements:
Option (A) Both Assertion (A) and Reason (R) are true, and Reason (R) correctly explains Assertion (A).
Option (B) Both Assertion (A) and Reason (R) are true, but Reason (R) does not correctly explain Assertion (A).
Option (C) Assertion (A) is true, but Reason (R) is false.
Option (D) Assertion (A) is false, but Reason (R) is true.
Correct Answer: (B) Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).
Identify the incorrect feature(s) of money supply (\(M_1\)) from the following:
(i) It is measured at a point of time.
(ii) It does not include stock of money held by the government.
(iii) It is always the currency in the hands of the Central Bank of a nation.