Given below are two statements, one labeled as Assertion (A) and the other labeled as Reason (R): Assertion (A): An increase in non-performing assets (NPAs) adversely affects a bank's profitability. Reason (R): Non-performing assets result in a decrease in the amount of funds available for lending. Select the correct answer using the codes given below:

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Economics · Banking and Financial Institutions

Verified Solution4 OptionsUpdated: October 2026👁️1 View

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Correct answer

Both (A) and (R) are true but (R) is not the correct explanation of (A)

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Answer 1

Both (A) and (R) are true and (R) is the correct explanation of (A)

Answer 2

Both (A) and (R) are true but (R) is not the correct explanation of (A)

Answer 3

(A) is true but (R) is false

Answer 4

(A) is false but (R) is true

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