Cause–Effect reasoning: Assess whether policy liberalization explains a national carrier's capacity increase. Statement I: The Government allowed private Indian airlines to operate to overseas destinations. Statement II: The national carrier increased its flights to overseas destinations. Choose the correct option describing the relationship.

Verbal Reasoning Cause and Effect Difficulty: Easy
Choose an option
  • A
    Statement I is the cause and Statement II is its effect
  • B
    Statement II is the cause and Statement I is its effect
  • C
    Both are independent causes
  • D
    Both are effects of independent causes
  • E
    Both are effects of a common cause

Answer

Correct Answer: Statement I is the cause and Statement II is its effect

Explanation

Logic Opening routes to private competitors increases competitive pressure; a typical strategic response is to add capacity and frequencies on lucrative sectors.

Causal chain Policy liberalization (I) → competition signal → national carrier scales up overseas flights (II).

Final Answer Statement I is the cause and Statement II is its effect

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