A government-owned steel company increases its output. Which of the following statements are correct?
(A) Employment in the government steel company rises directly.
(B) Private companies which buy steel from it also raise their output and employment.
(C) The rise in employment in those private companies is indirect generation of employment by the government.
(D) Indirect generation means that the government itself pays the workers of those private companies.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → (A), (B) and (C) only
When a government steel company grows, it hires more people directly. Private firms that buy its steel also grow and hire more. Those private jobs are indirect employment created by the government.
(A) Employment in the government steel company rises directly. — Correct. The government company itself takes on more workers.
(B) Private companies which buy steel from it also raise their output and employment. — Correct. More steel lets them produce more.
(C) The rise in employment in those private companies is indirect generation of employment by the government. — Correct. The government’s action leads to these jobs.
(D) Indirect generation means that the government itself pays the workers of those private companies. — Incorrect. The private companies pay their own workers. The government only sets off the growth.
NCERT (2026-27): “6.9 Government and Employment Generation … When the output of goods and services from government enterprises increases, then private enterprises which receive raw materials from government enterprises will also raise their output and hence increase the number of employment opportunities in the economy. For example, when a government owned steel company increases its output, it will result in direct increase in employment in that government company. Simultaneously, private companies, which purchase steel from it, will also increase their output and thus employment. This is the indirect generation of employment opportunities by the government initiatives in the economy. …” |