Statement I: The company's profits have increased by 40% this year. Statement II: The company reduced its workforce to cut costs.
Correct answer: C. Both are effects of a common cause
- A. I is the cause and II is its effect
- B. II is the cause and I is its effect
- C. Both are effects of a common cause
- D. Both are independent
Explanation
The correct answer is that both statements are effects of a common cause. The increase in profits and the reduction in workforce may both result from a strategic decision by the company to streamline operations and improve financial performance. Option A is incorrect because the increase in profits does not directly cause a reduction in workforce. Option B is incorrect because while workforce reduction may help cut costs, it alone does not account for the entire profit increase. Option D is incorrect as it ignores potential connections and common causes.
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About Cause and Effect
Cause and effect questions examine whether one event produces another, whether both arise from a common factor, or whether their connection is only coincidental. They involve identifying preceding and resulting events, separating correlation from causation, and judging whether the stated evidence supports a direct, possible or unlikely relationship.
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