Question : Statement 1: Labor market flexibility is essential for promoting employment growth in India.
Statement 2: Labor market flexibility refers to the ease of hiring and firing workers.
Option 1: Both statements are true.
Option 2: Both statements are false.
Option 3: Statement 1 is true, statement 2 is false.
Option 4: Statement 1 is false, statement 2 is true.
Correct Answer: Both statements are true.
Solution : The correct answer is (a) Both statements are true.
Statement 1 is true. Labor market flexibility is considered important for promoting employment growth in India. It refers to the ability of the labor market to adjust and respond to changes in demand and supply conditions, allowing for smoother transitions between jobs and facilitating the creation of new employment opportunities. Flexible labor markets can lead to increased job creation, entrepreneurship, and investment, which can contribute to overall employment growth.
Statement 2 is also true. Labor market flexibility does refer to the ease of hiring and firing workers. It encompasses factors such as employment protection regulations, contract types, dismissal procedures, and flexibility in working arrangements. The ease of hiring and firing workers is a key aspect of labor market flexibility as it enables employers to adjust their workforce according to changing business needs and economic conditions.
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