Introduction / Context:
The government attempts to curb rising sugar prices by increasing supply via imported sugar. The logic rests on compliance and basic supply-demand economics, not on detailed behavior of indigenous sugar prices.
Given Data / Assumptions:
- I: Dealers will release the sugar as directed.
- II: Increased supply will ease the price (downward pressure).
- III: Indigenous sugar prices will remain unchanged despite the intervention.
Concept / Approach:
- A policy directive assumes implementation (I).
- To address high prices through supply, one must assume a standard inverse relation between supply and price (II), ceteris paribus.
- III is not necessary: indigenous prices may adjust too; the policy does not require them to stay fixed.
Step-by-Step Solution:
Retain I: Without compliance, the directive is futile.Retain II: The intended effect is lower prices via more supply; this is the core economic premise.Reject III: The policy’s success does not rely on indigenous prices being static; total market price is the target.
Verification / Alternative check:
If I fails, no additional supply reaches the market. If II fails, higher supply would not help prices. III is unnecessary to the causal chain.
Why Other Options Are Wrong:
II and III or I and III misplace emphasis on an irrelevant condition. “None” overlooks basic compliance and supply logic. “All” adds an unneeded constraint.
Common Pitfalls:
Assuming stability of all other price components; policies often target net outcomes, not invariance of every component.
Final Answer:
Only I and II are implicit
Discussion & Comments