UPSC Civil Services Model Paper 4

Invoking Essential Commodities Act against hoarding traders and stockist reduces hoarding and increases supply in the market thus reducing prices. So, statement 1 is correct.
Prices rise when production falls short of demand. Zero duty on exports would further reduce domestic supply. So, statement 2 is NOT correct.
Futures and forward trading in times of price rise further destabilizes food prices by speculation. The government recently suspended such trading in view of rising pulse prices. So, statement 3 is NOT correct.