Question

Read the following statements carefully and choose the correct alternative:

Assertion (A): Labour is perishable.

Reason (R): Capital is an active factor of production.

Options

• Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

• Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

• Assertion (A) is true but Reason (R) is false.

• Assertion (A) is false but Reason (R) is true.

Answer 1

Assertion (A) is true but Reason (R) is false.

Explanation:

• Assertion (A): "Labour is perishable" is true. Labour is considered perishable because it cannot be stored or saved for future use. If a labourer does not work on a given day, the opportunity to use that labour is lost.

• Reason (R): "Capital is an active factor of production" is false. Capital is generally considered a passive factor of production because it requires labour and entrepreneurship to be productive. Labour and entrepreneurship are active factors in the production process.