Question

    Consider the following statements regarding ‘employment elasticity’:

    1. It is a measure of the percent change in employment associated with a unit percentage point change in economic growth.

    2. Construction has higher employment elasticity than agriculture.

    3. Employment elasticity is a measure of the percentage change in employment associated with a 10% point change in economic growth.

    Which of the statements given above is/are incorrect?

    A 1 only Correct Answer Incorrect Answer
    B 2 only Correct Answer Incorrect Answer
    C 3 only Correct Answer Incorrect Answer
    D Both 1 and 2 Correct Answer Incorrect Answer
    E Both 2 and 3 Correct Answer Incorrect Answer

    Solution

    Employment elasticity is a measure of the percentage change in employment associated with a 1 percentage point change in economic growth.

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