Given below are two statements: one is labelled as Assertion (A) and the other is labelled as Reason (R).
Assertion (A): A macroeconomics book that studies the working of a capitalist economy may not be entirely able to capture the functioning of a developing country.
Reason (R): Many developing countries have a significant presence of production units organised according to capitalist principles.
In the light of the above statements, choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Both (A) and (R) are true but (R) is not the correct explanation of (A).
Assertion (A): A macroeconomics book that studies the working of a capitalist economy may not be entirely able to capture the functioning of a developing country. — True. Much of a developing country, such as peasant farming, does not work on capitalist lines.
Reason (R): Many developing countries have a significant presence of production units organised according to capitalist principles. — True. Developing countries do have many capitalist firms as well.
Why R does not explain A?
R points to the part of a developing country that does fit a capitalist economy. It cannot explain why the book may fail to capture such a country.
A is true because, in many underdeveloped countries, farming is done by peasant families. Wage labour is seldom used, and much of the output is consumed by the family itself.
NCERT (2026-27): “1.2 Context of the Present Book of Macroeconomics … In many underdeveloped countries production (in agriculture especially) is carried out by peasant families. Wage labour is seldom used and most of the labour is performed by the family members themselves. Production is not solely for the market; a great part of it is consumed by the family. … It is, however, true that many developing countries have a significant presence of production units which are organised according to capitalist principles.” “Summary … In this book we shall mostly deal with the working of a capitalist economy. Hence it may not be entirely able to capture the functioning of a developing country.” |