In an economic activity lsquo Marginal Productivity of Labour rsquo becomes zero even though labour ...........

Indian Economy Poverty and employment

Download Solution PDF

In an economic activity, ‘Marginal Productivity of Labour’ becomes zero even though labour is working. This signifies

Frictional Unemployment

Disguised Unemployment

Cyclical Unemployment

Voluntary Unemployment

छोटे Courses बड़े Results

Master Poverty and employment

Prepare through Micro-courses

Try Now

Explanation:

- Marginal Productivity of Labour: This concept measures the additional output from adding one more unit of labour while keeping other inputs constant. A zero value indicates additional labour doesn't increase output.

- Option 1: Frictional Unemployment: This is temporary and occurs when people are between jobs or entering the workforce. It's a short-term mismatch in the job market.

- Option 2: Disguised Unemployment: Occurs when more workers are employed than necessary, especially in agriculture. Here, surplus workers don't contribute to productivity.

- Option 3: Cyclical Unemployment: This results from economic downturns when demand for goods and services decreases, leading to layoffs.

- Option 4: Voluntary Unemployment: Occurs when workers choose not to work at the current wage rate or conditions.

Option 2: Disguised Unemployment is Correct