Question

Statement (1): Economic fluctuations are widely seen in a capitalist economy.

Statement (2): Under capitalism, consumers do not enjoy freedom of choice.

Options

• Both statements are true.

• Both statements are false.

• Statement 1 is true, Statement 2 is false.

• Statement 2 is true, Statement 1 is false.

Answer 1

Statement 1 is true, Statement 2 is false.

Explanation:

• Statement 1: “Economic fluctuations are widely seen in a capitalist economy”. This is true because capitalism is known for economic cycles involving booms and busts.
• Statement 2: “Under capitalism, consumers do not enjoy freedom of choice”. This is false. Capitalism generally provides consumers with a wide freedom of choice in the market, as the market operates on competition and consumer preferences.

Therefore, the correct choice is (c) because economic fluctuations are common in capitalism, but consumers do enjoy freedom of choice under capitalism.