Capacity increases --- I think he meant the capacity to store the memory blocks it can increase as in direct mapped only the particular block is stored by mod but in 2 set associativity twice the number of blocks can be stored when compared with set to a block --so true
Sequential access has nothing to do with associativity ----so true
Size increases --- the capacity of cache cannot increase .----so false
Access time gets faster --- but due to associativity the tag bits which are to be compared will be more than the direct cache so the access time will be slower ----so false