Question

The government has decided to disinvest large chunks of its equity in select public sector undertakings for a better fiscal management. Assumptions: I. The amount generated out of the disinvestments process may reduce substantially the mounting fiscal deficits. II. There will be enough demand in the market for the shares of these undertakings.

• A. if only assumption I is implicit
• B. if only assumption II is implicit
• C. if neither assumption I nor II is implicit
• D. if both assumptions I and II are implicit

Hint:

When analyzing assumptions, ensure they logically support the given statement. If the assumption is necessary for the statement to hold true, it is implicit.

Answer 1

The Correct Option is D

- Assumption I is implicit as the disinvestment process is expected to reduce fiscal deficits. - Assumption II is also implicit as for disinvestment to be successful, there must be enough demand for the shares of these companies.
Hence, both assumptions I and II are implicit.
Thus, the correct answer is (D).