Statement 1- It is correct because we have limited memory of 200Mb. As per options, we can figure out that both process are running concurrently and first p1 take 80Mb from 200, so 200-80=120MB remaining. After that, P2 demands 70Mb, so 120-70=50Mb reaming. And 50 Mb is not sufficient for either of the processes to complete. P1 will wait for P2 to complete and release captured memory, and p2 will wait for p1 to get complete and release captured memory. Here both process will get stuck and this is deadlock.
Statement 2- Because of statement 1 is true, statement 2 is false.