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Question : 48
Total: 52
Mr. Rishi, after completing his education, has joined his family business but his marginal productivity is zero.'
Comment upon the employment status of Mr. Rishi. Give valid reasons in support of your answer.
Comment upon the employment status of Mr. Rishi. Give valid reasons in support of your answer.
Solution:
In the example given, Mr. Rishi is disguised unemployed.
Reasons:
1. Disguised unemployment is that when number of workers engaged is more than required. And in the example given, there is no need of Mr. Rishi as a worker.
2. His marginal productivity is zero i.e., there is no change in total output of the business whether he joins or exits from it.
3. Since he has joined his family business, he seems to work but in actual, his contribution is zero.
Reasons:
1. Disguised unemployment is that when number of workers engaged is more than required. And in the example given, there is no need of Mr. Rishi as a worker.
2. His marginal productivity is zero i.e., there is no change in total output of the business whether he joins or exits from it.
3. Since he has joined his family business, he seems to work but in actual, his contribution is zero.
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