Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A) Flexible exchange rate is a shock absorber. Reason (R) Flexible exchange rate does not save the internal economy from the disturbing affects from abroad. Codes

• A.                                  Both A and R are true, and R is the correct explanation of A
• B.                     Both A and R are true, but R is not the correct explanation of A
• C.                     A is true, but R is false
• D.                     A is false, but R is true