Statement–Courses of Action (payroll crisis in a state): Due to financial stringency, the State Government has been unable to pay salaries to employees since April; determine which course(s) follow—(I) immediately curtail staff strength by at least 30%, (II) reduce wasteful expenditure and arrange to pay salaries—emphasizing fiscal prudence versus precipitous downsizing.

Given data

• Problem: Salaries unpaid since April due to fiscal stress.
• Course I: Slash workforce by 30% immediately.
• Course II: Cut wasteful spending and arrange salary payments.

Concept / Approach
Appropriate action should restore essential obligations (salaries) through expenditure rationalisation before irreversible structural changes.

Step-by-step evaluation
Step 1: Course II directly addresses the cause (resource misallocation) and the effect (unpaid salaries) with proportionate measures.Step 2: Course I is drastic, may impair service delivery, and is not justified by the statement; no evidence supports a 30% cut specifically.

Verification / Alternative
Cash-flow reprioritisation, austerity on non-essentials, and bridge financing are standard first responses; layoffs require a separate evidence base.

Common pitfalls

• Equating short-term liquidity problems with the need for mass retrenchment.

Final Answer
Only II follows.