Directions: In the question below is given a statement followed by two conclusions numbered I and II. You have to assume everything in the statement to be true, then consider the two conclusions together and decide which of them logically follow beyond a reasonable doubt from the information given in the statement. Give answer.

Statement: Company M had to cut down 20% of its employee strength to remain profit-making.

Conclusions:

1. Company M would have made losses if they hadn’t cut down their employee strength.
2. Company M’s revenues have decreased.