Target Exam

CUET

Subject

Economics

Chapter

Indian Economic Development: Employment - Growth, Informalisation and Other Issues

Question:

Which of the following correctly defines "Disguised unemployment"?

Options:

More number of workers are involved than required

Marginal productivity of an additional worker is almost zero

Both 1 and 2

None of the above

Correct Answer:

Both 1 and 2

Explanation:

The correct answer is option 3: Both 1 and 2

Disguised unemployment refers to a situation where more workers are engaged than actually required for a given level of output. As a result, the marginal productivity of some workers is zero or nearly zero, meaning that if they are withdrawn, total output does not fall.