Given below are two statements:
Assertion (A): Personal selling influences the economic growth of a society.
Reason (R): Personal selling converts latent demand into effective demand, and this cycle leads to more jobs, more incomes and more products and services.
In the light of the above statements, choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Both (A) and (R) are true and (R) is the correct explanation of (A).
Assertion (A): Personal selling influences the economic growth of a society. — True. Personal selling plays a productive role in the economic progress of a society.
Reason (R): Personal selling converts latent demand into effective demand, and this cycle leads to more jobs, more incomes and more products and services. — True. Latent demand is a want that people have but do not yet act on by buying. Personal selling turns it into effective demand, that is, actual buying.
Why R explains A?
A is about the effect of personal selling on economic growth. R is about how it turns latent demand into effective demand and starts a cycle of more jobs and incomes.
When latent demand becomes effective demand, people buy more. So firms produce more, which creates more jobs and more incomes. With more income people buy still more, and the cycle goes on. This rise in economic activity is the economic growth that A speaks of.
NCERT (2026-27 Edition):
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