The correct answer is: Only conclusion I follows.
The statement says that water supply in wards A and B of the city will be affected by about 50% on Friday. This means that the residents in these wards will have only half the amount of water they usually have. Therefore, it is advisable for them to economise on water on Friday.
However, the statement does not say anything about whether or not the residents should store some water on the previous day. It is possible that the water supply will be restored by the end of the day, in which case there would be no need to store water. Therefore, conclusion II does not follow.
In conclusion, only conclusion I follows.