Girdharilal Gandhi is the owner of Pritam Ltd. He hired 250 workers in his factory. If 25 workers are dismissed by him without any loss to production, then what will this situation be called as?
Answer & explanation
Correct answer: option 2
The correct answer is Option 2: Disguised unemployment
Disguised unemployment exists when more workers are employed than actually required, and removing some workers does not affect the level of production.
In this case, even after dismissing 25 workers, production remains unchanged, which shows that these workers were not contributing to additional output, hence indicating disguised unemployment.