ECONOMICS
COST BENEFIT ANALYSIS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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higher unemployment and more prosperity.
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higher unemployment and less prosperity.
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lower unemployment and more prosperity.
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No change in unemployment and no change in prosperity.
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Detailed explanation-1: -Unemployment affects the overall growth of an economy as (i) it is a wastage of manpower resource. (ii) it increases the economic overload. (iii) it tends to increase the number of dependent population. (iv) increase in unemployment is an indicator of a depressed economy.
Detailed explanation-2: -Tends to increase economic overload, The dependence of the unemployed on working population increases, Quality of life adversely affected, Unemployed turns into a liability.
Detailed explanation-3: -One of the reasons why the official unemployment rate is an imperfect measure is that this figure excludes under-employed employees or involuntary part-timers. Normally, the part-time employees who want to work full time and cannot secure such jobs are considered employed, that is, not counted as unemployed.
Detailed explanation-4: -Unemployment results in reduced demand, consumption, and buying power, which in turn causes lower profits for businesses and leads to budget cuts and workforce reductions. It creates a cycle that goes on and on that is difficult to reverse without some type of intervention.