A self-employed person earns a living by working for himself or herself, running his or her own business or trade, rather than working for an employer for a salary or wage. Which of the following situations is the best example of a self-employed person?
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → Anil owns a small bicycle-repair shop and keeps whatever he earns from mending his customers’ bicycles.
A self-employed person has two marks: he or she works to earn a living, and does so by running his or her own business, not by working for an employer.
In Option (3) Anil owns the repair shop and keeps what he earns from his customers; no employer pays him. Both marks are present.
Why the other options are incorrect
Option (1) Anil works as a mechanic in a large bicycle company and is paid a monthly salary. — Incorrect. Anil works for an employer (the company) and is paid a salary.
Option (2) Anil, a retired soldier, lives on his monthly pension and does no paid work. — Incorrect. Anil does no work to earn a living; he lives on his pension.
Option (4) Anil works as a cook in a restaurant, and the owner pays him a daily wage. — Incorrect. Anil works for an employer (the restaurant owner) and is paid a wage.