Statement: If gifts are passed on from one person to another, the whole purpose of the gift is defeated. Therefore, a gift should be something useful that attracts you, appeals to you and that you retain instead of passing on. Conclusions: I. If gifts are retained, their utility increases. II. Gifts are not meant for repeated change of hands.

Introduction / Context:
This problem is a typical statement-and-conclusion question about the purpose and nature of gifts. The statement argues that passing on gifts defeats their purpose and therefore suggests that a good gift should be one that the receiver keeps and uses. You need to decide which of the given conclusions logically follow from this reasoning, not from your personal opinions about gifting.

Given Data / Assumptions:

Main idea: If gifts are passed on, the whole purpose of the gift is defeated.
Therefore, gifts should be useful, attractive, appealing and retained by the receiver.
Conclusion I: If gifts are retained, their utility increases.
Conclusion II: Gifts are not meant for repeated change of hands.

Concept / Approach:
We must see what the author of the statement is clearly asserting or implying. The focus in the statement is on the purpose of a gift and on the act of passing it on versus retaining it. Nothing explicit is said about the “utility” increasing when a gift is retained. Logical conclusions must be directly or strongly implied by the given sentence, not created by adding new ideas.

Step-by-Step Solution:
From the statement: “If gifts are passed on, the whole purpose of the gift is defeated.” This clearly means that, as per the author, a gift should not be passed from one person to another, and that gifts are meant to stay with the original recipient. Therefore, it is natural to infer that gifts are not intended for repeated changes of ownership. This directly supports Conclusion II. The second part of the statement says that a gift should be useful, attractive, appealing and something that you retain. The stress is on retention as part of fulfilling the purpose of the gift. However, nothing in the statement says that simply retaining a gift “increases its utility”. Utility may depend on use or need, not just on retention. Thus, Conclusion I introduces a new idea (increase in utility) which is not necessarily implied by the original argument. It therefore does not logically follow.

Verification / Alternative check:
You can rephrase the statement as: “Gifts should not be passed on; they should be kept and appreciated by the receiver.” This clearly matches Conclusion II, which states that gifts are not meant for repeated change of hands. But any attempt to connect retention with increased utility goes beyond what the author actually said. Utility might stay the same whether the gift is retained or not, so Conclusion I is unwarranted.

Why Other Options Are Wrong:
Choosing only Conclusion I ignores the explicit rejection of passing on gifts present in the statement. Choosing both conclusions treats an unsupported idea (increase in utility) as if it were stated. Saying neither follows contradicts the clear implication regarding the purpose of a gift and the avoidance of passing it on. The “either I or II” option applies to mutually exclusive valid conclusions, which is not the case here.

Common Pitfalls:
A typical mistake is to overinterpret the word “retain” as automatically implying more utility. Candidates may also confuse the emotional value of a retained gift with a logical increase in utility. In logical reasoning, every extra word in a conclusion needs justification from the original statement, which we do not have here for Conclusion I.

Final Answer:
Only the statement that gifts are not meant for repeated change of hands logically follows. So the correct option is If only conclusion II follows.