Asked in KMU MDCAT 2023 2023Moderate

The rates of interest on Post office recurring deposit accounts have been increased with effect from 1st March. This has been done to attract more deposits.Course of ActionI. Efforts should also be made to make the public aware about this increase in the rate of Interest.II. If the deposits don't increase in next six months, the rate of interest should be further Increased.

Correct answer: D. Both conclusions I and II follow

  • A. Only conclusion I follows
  • B. Only conclusion II follows
  • C. Neither I nor II follows
  • D. Both conclusions I and II follow

Explanation

The question presents a scenario where the interest rates on post office recurring deposit accounts have been increased to attract more deposits. Conclusion I advocates for public awareness of this increase, which is essential for informing potential depositors and encouraging them to invest. Conclusion II suggests that if deposits do not rise in the following six months, the interest rate should be increased further, allowing for a responsive strategy to enhance deposit attraction.Both conclusions are valid because they address different aspects of the same objective: to increase deposits. The first focuses on communication, while the second emphasizes evaluation and adjustment based on initial results. Therefore, the correct answer is that both conclusions follow.Option A is incorrect as it only considers the need for public awareness, ignoring the evaluation aspect. Option B wrongly prioritizes only the evaluation without acknowledging the need for awareness. Option C dismisses both actions, which is inaccurate given their relevance to the situation.

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About Course of Action

Course of action questions present a problem and several proposed responses, asking whether each response is practical, relevant, proportionate and directed at the stated cause. Sound action should be feasible and ethical, while an immediate reaction, an unrelated measure or an extreme solution does not necessarily address the problem.

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