Hoarding is buying and storing far more of a product than one needs, because one expects the product to become scarce or costly. Which of the following situations is the best example of hoarding?
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Hearing that onion prices may rise sharply, Mr Sinha buys 200 kg of onions for his family of three and stores them in his garage.
Hoarding has three parts: a person buys and stores a product, the amount is far more than he or she needs, and the reason is that the product is expected to become scarce or costly.
In Option (1) Mr Sinha buys and stores 200 kg of onions, which is far more than a family of three needs, because he hears that prices may rise. All three parts are present.
Why the other options are incorrect
Option (2) Mr Sinha buys 2 kg of onions for the week’s cooking. — Incorrect. Two kilograms for a week is what the family needs, not far more.
Option (3) Mr Sinha decides to buy a large stock of onions, but the market is closed, so he buys none. — Incorrect. Mr Sinha buys and stores nothing.
Option (4) Mr Sinha buys 200 kg of onions and gives all of them the same day to a community kitchen. — Incorrect. Mr Sinha gives the onions away; he does not store them.