Given below are two statements: one is labelled as Assertion (A) and the other is labelled as Reason (R).
Assertion (A): In a centrally planned economy, the government may itself decide to produce a service such as education or health.
Reason (R): Such a service is very important for the well-being of the economy, and individuals may not produce enough of it on their own.
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): In a centrally planned economy, the government may itself decide to produce a service such as education or health. — True. Where such a service is short, the government may produce it itself.
Reason (R): Such a service is very important for the well-being of the economy, and individuals may not produce enough of it on their own. — True. Education and health matter for the well-being of the whole economy. Individuals on their own may produce too little of them.
Why R explains A?
The government steps in only because the service matters so much and individuals produce too little of it. R gives that reason, so it explains why the government may produce the service itself.
NCERT (2026-27): “1.3.1 The Centrally Planned Economy … The central authority may try to achieve a particular allocation of resources and a consequent distribution of the final combination of goods and services which is thought to be desirable for society as a whole. For example, if it is found that a good or service which is very important for the prosperity and well-being of the economy as a whole, e.g. education or health service, is not produced in adequate amount by the individuals on their own, the government might try to induce the individuals to produce adequate amount of such a good or service or, alternatively, the government may itself decide to produce the good or service in question. …” |