Assertion (A): A high operating ratio indicates a favourable position.
Reason (R): A high operating ratio leaves a high margin to meet non-operating expenses.

A) Both (A) and (R) are correct, and (R) correctly explains (A) B) Both (A) and (R) are correct, but (R) does not explain (A) C) Both (A)and (R) are incorrect D) (A) is correct, but (R) is incorrect

Answer & Solution

Correct Answer: Option C

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Assertion (A) A high operating ratio indicates a favourable position Reason...

Assertion (A): A high operating ratio indicates a favourable position. Reason (R): A high operating ratio leaves a high margin to meet non-operating expenses.

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Assertion (A): A high operating ratio indicates a favourable position.
Reason (R): A high operating ratio leaves a high margin to meet non-operating expenses.