Read the following statements -
Assertion (A): International economic transactions are called autonomous when they are dependent on the state of BoP.
Reason(R): Autonomous Transactions occur with the objective of earning profit.
From the given alternatives choose the correct one:
Answer & explanation
Correct answer: option 4
The correct answer is Option 4: Assertion (A) is false but Reason (R) is true.
Assertion (A): International economic transactions are called autonomous when they are dependent on the state of BoP. This is incorrect. International economic transactions are not dependent on the state of BoP when they are autonomous. They occur regardless of BoP status.
Reason(R): Autonomous Transactions occur with the objective of earning profit. This is correct. Autonomous transactions are international transactions that occur due to market forces. They are generally driven by profit motives, such as trade, investments, and other economic activities.