Statement — The school authority has decided to increase the number of students in each classroom to seventy from the next academic session to bridge the gap between income and expenditure to a large extent. Assumptions — I. The additional fee income from the extra students will be sufficient to bridge the gap substantially. II. The school will actually be able to enroll all the additional students in each class from the next session.

Introduction / Context:Increasing class size is a financial lever aimed at raising fee revenue. For the policy to achieve its goal, two things must be true: (a) demand exists so that added seats are filled, and (b) the incremental revenue meaningfully reduces the deficit. Without both beliefs, the decision would be ineffective or purely symbolic.

Given Data / Assumptions:

• Decision: raise per-class strength to 70 from next session.
• I: per-seat fee revenue * added seats ≈ material gap reduction.
• II: enrollment demand will fill the new capacity.

Concept / Approach:Revenue = fee per student * number of students. The plan presumes that increasing the second factor (headcount) will increase revenue enough to matter and that the market can supply the required students. Hence both I and II are necessary presuppositions.

Step-by-Step Solution:

Verification / Alternative check:If classes fail to fill or fees are too low, the gap will remain wide—contradicting the policy’s stated impact. Both I and II are thus essential.

Why Other Options Are Wrong:

Common Pitfalls:Ignoring capacity constraints (rooms/teachers) is beyond the minimal assumptions—the required ones are demand and revenue adequacy.

Final Answer:Both Assumption I and II are implicit.