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Home Questions 2QM38F3BMD
Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Money and Banking

Question:

Read the following statements - Assertion (A) and Reason (R):
Assertion: No citizen can refuse to take currency notes for settlement of economic transactions.
Reasoning: Currency notes are the legal tender.
From the given alternatives choose the correct one:

Options:

Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

Assertion (A) is true but Reason (R) is false.

Assertion (A) is false but Reason (R) is true.

Correct Answer:

Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

Explanation:

The correct answer is Option 1: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

No citizen can refuse to accept the currency notes and coins for settlement of economic transaction because currency notes and coins are legal tender. By definition, legal tender is anything recognized by law as a means to settle a public or private debt or meet a financial obligation.

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