Assertion: A supply curve shows the levels of output that a firm chooses to produce at different market prices.

Reasoning: Market supply curve is an aggregate of the supply curves of individual firms .

Both Assertion (A) and reasoning (R) are correct and but R is not the correct explanation of A.

The correct answer is Option 2: Both Assertion (A) and reasoning (R) are correct and but R is not the correct explanation of A.

Assertion: A supply curve shows the levels of output that a firm chooses to produce at different market prices. True. A supply curve represents the relationship between the price of a good and the quantity a firm is willing to supply. According to the law of supply, when the price of a good rises, firms tend to increase production, and when the price falls, they reduce production, assuming other factors remain constant. The supply curve visually depicts this relationship, making the assertion correct.

Reasoning: Market supply curve is an aggregate of the supply curves of individual firms. True. The market supply curve is obtained by summing up the supply curves of all individual firms in the market. Each firm's supply curve shows how much it will produce at various prices, and when these individual supply schedules are combined, they form the market supply curve. Therefore, the reasoning is correct.

Does the reasoning explain the assertion? No. While both statements are true, the reasoning does not explain why a firm’s supply curve represents its output choices at different prices. Instead, it discusses how individual supply curves combine to form the market supply curve, which is a separate concept. Therefore, the reasoning is true but does not adequately explain the assertion.