Direction: In each question below is given a statement followed by two assumptions numbered I and II. An assumption is something supposed or taken for granted. You have to consider the statement and the following assumptions and decide which of the assumption(s) is/are implicit in the statement.
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Statement
The target of a fiscal deficit of 5% of GDP could not be met because of major shortfall in revenue collection.
Assumptions
I . Shortfall in revenue collection leads to an increase in fiscal deficit.
II. Shortfall in revenue collection leads to a decrease in fiscal deficit.
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- if only Assumption I is implicit
- if only Assumption II is implicit
- If either Assumption I or II is implicit
- if neither Assumption I nor II is implicit
Correct Option: A
Clearly, the statement is based on the assumption that shortfall in revenue collection leads to an increase in fiscal deficit. Hence, Assumption I is implicit.
