Statement (1): From the information given, we can conclude that both, a and b are not negative. The two absolute values must be positive (the question stem tells us they are not 0), so a + b must also be positive. As the absolute values have the same sign, a and be must also have the same sign, otherwise their sum would not be equal to the sum of their absolute values.
Picking a few number pairs, we quickly realize that that information is sufficient. This also makes sense theoretically. Going from \(\frac{1}{a}\) to \(\frac{1}{(a+b)}\) will always decrease the term for positive a and b, while going from \(\frac{1}{a}\) to \(\frac{1}{a}+\frac{1}{b}\) will always increase the term.
So statement 1 is sufficient.
Statement (2): Here we can easily show that this is not sufficient by picking numbers. Choose e.g. 2 and 2, so we get \(\frac{1}{4}<1\), which is obviously true. But picking 2 and -1 will give \(1<\frac{1}{2}-1\), which is obviously wrong.
Therefore, answer A is correct.