Question Description
DIRECTIONS for the question:Read the passage and answer the question based on it.Let us consider a very simple example. Some earth-moving job has to be done in an area of high unemployment. There is a wide choice of technologies, ranging from the most modern earth- moving equipment to purely manual work without tools of any kind. The output is fixed by the nature of the job, and it is quite clear that the capital / output ratio will be highest, if the input of capital is kept lowest. If the job were done without any tools, the capital/output ratio would be infinitely large, but the productivity per man would be exceedingly low. If the job were done at the highest level of modern technology, the capital/output ratio would be low and the productivity per man very high.Neither of these extremes is desirable, and a middle way has to be found. Assume some of the unemployed men were first set to work to make a variety of tools, including wheel-barrows and the like, while others were made to produce various wages goods. Each of these lines of production in turn could be based on a wide range of different technologies, from the simplest to the most sophisticated. The task in every case would be to find an intermediate technology which obtains a fair level of productivity without having to resort to the purchase of expensive and sophisticated equipment. The outcome of the whole venture would be an economic development going far beyond the completion of the initial earth-moving Project. With a total input of capital from outside which might be much smaller than would have been involved in the acquisition of the most modern earth-moving equipment, and an input of (previously unemployed) labour much greater than the modern method would have demanded, not only a given project would have been completed, but a whole community would have been set on the path of development.I say, therefore, that the dynamic approach to development, which treats the choice of appropriate, intermediate technologies as the central issue, opens up avenues of constructive action, which the static, econometric approach totally fails to recognise. This leads to the next objection which has been raised against the idea of intermediate technology. It is argued that all this might be quite promising if it were not for a notorious shortage of entrepreneurial ability in the under-developed countries. This scarce resource should therefore be utilised in the most concentrated way, in places where it has the best chances of success and should be endowed with the finest capital equipment the world can offer. Industry, it is thus argued, should be established in or near the big cities, in large integrated units, and on the highest possible level of capitalisation per workplace.The argument hinges on the assumption that entrepreneurial ability is a fixed and given quantity, and thus again betrays a purely static point of view. It is, of course, neither fixed nor given, being largely a function of the technology to be employed. Men, quite incapable of acting as entrepreneurs on the level of modern technology, may nonetheless be fully capable of making a success of a small-scale enterprise set up on the basis of intermediate technology - for reasons already explained above. In fact, it seems to me, that the apparent shortage of entrepreneurs in many developing countries today is precisely the result of the negative demonstration effect of a sophisticated technology infiltrated into an unsophisticated environment. The introduction of an appropriate, intermediate technology would not be likely to founder on any shortage of entrepreneurial ability. Nor would it diminish the supply of entrepreneurs for enterprises in the modem sector; on the contrary, by spreading familiarity with systematic, technical modes of production over the entire population it would undoubtedly help to increase the supply of the required talent.Q.As used in the last paragraph, which of the following would be an appropriate example of a ‘demonstration effect’?A. Ethics and value systems of a society influence the level of entrepreneurship.B. Parents taking care of their parents.C. Odisha adopting the Bihar model for economic policies.D. The American War of Independence influencing the French Revolution.a)A and C onlyb)A onlyc)B, C and D onlyd)C and D onlyCorrect answer is option 'C'. Can you explain this answer? for CAT 2024 is part of CAT preparation. The Question and answers have been prepared according to the CAT exam syllabus. Information about DIRECTIONS for the question:Read the passage and answer the question based on it.Let us consider a very simple example. Some earth-moving job has to be done in an area of high unemployment. There is a wide choice of technologies, ranging from the most modern earth- moving equipment to purely manual work without tools of any kind. The output is fixed by the nature of the job, and it is quite clear that the capital / output ratio will be highest, if the input of capital is kept lowest. If the job were done without any tools, the capital/output ratio would be infinitely large, but the productivity per man would be exceedingly low. If the job were done at the highest level of modern technology, the capital/output ratio would be low and the productivity per man very high.Neither of these extremes is desirable, and a middle way has to be found. Assume some of the unemployed men were first set to work to make a variety of tools, including wheel-barrows and the like, while others were made to produce various wages goods. Each of these lines of production in turn could be based on a wide range of different technologies, from the simplest to the most sophisticated. The task in every case would be to find an intermediate technology which obtains a fair level of productivity without having to resort to the purchase of expensive and sophisticated equipment. The outcome of the whole venture would be an economic development going far beyond the completion of the initial earth-moving Project. With a total input of capital from outside which might be much smaller than would have been involved in the acquisition of the most modern earth-moving equipment, and an input of (previously unemployed) labour much greater than the modern method would have demanded, not only a given project would have been completed, but a whole community would have been set on the path of development.I say, therefore, that the dynamic approach to development, which treats the choice of appropriate, intermediate technologies as the central issue, opens up avenues of constructive action, which the static, econometric approach totally fails to recognise. This leads to the next objection which has been raised against the idea of intermediate technology. It is argued that all this might be quite promising if it were not for a notorious shortage of entrepreneurial ability in the under-developed countries. This scarce resource should therefore be utilised in the most concentrated way, in places where it has the best chances of success and should be endowed with the finest capital equipment the world can offer. Industry, it is thus argued, should be established in or near the big cities, in large integrated units, and on the highest possible level of capitalisation per workplace.The argument hinges on the assumption that entrepreneurial ability is a fixed and given quantity, and thus again betrays a purely static point of view. It is, of course, neither fixed nor given, being largely a function of the technology to be employed. Men, quite incapable of acting as entrepreneurs on the level of modern technology, may nonetheless be fully capable of making a success of a small-scale enterprise set up on the basis of intermediate technology - for reasons already explained above. In fact, it seems to me, that the apparent shortage of entrepreneurs in many developing countries today is precisely the result of the negative demonstration effect of a sophisticated technology infiltrated into an unsophisticated environment. The introduction of an appropriate, intermediate technology would not be likely to founder on any shortage of entrepreneurial ability. Nor would it diminish the supply of entrepreneurs for enterprises in the modem sector; on the contrary, by spreading familiarity with systematic, technical modes of production over the entire population it would undoubtedly help to increase the supply of the required talent.Q.As used in the last paragraph, which of the following would be an appropriate example of a ‘demonstration effect’?A. Ethics and value systems of a society influence the level of entrepreneurship.B. Parents taking care of their parents.C. Odisha adopting the Bihar model for economic policies.D. The American War of Independence influencing the French Revolution.a)A and C onlyb)A onlyc)B, C and D onlyd)C and D onlyCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CAT 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for DIRECTIONS for the question:Read the passage and answer the question based on it.Let us consider a very simple example. Some earth-moving job has to be done in an area of high unemployment. There is a wide choice of technologies, ranging from the most modern earth- moving equipment to purely manual work without tools of any kind. The output is fixed by the nature of the job, and it is quite clear that the capital / output ratio will be highest, if the input of capital is kept lowest. If the job were done without any tools, the capital/output ratio would be infinitely large, but the productivity per man would be exceedingly low. If the job were done at the highest level of modern technology, the capital/output ratio would be low and the productivity per man very high.Neither of these extremes is desirable, and a middle way has to be found. Assume some of the unemployed men were first set to work to make a variety of tools, including wheel-barrows and the like, while others were made to produce various wages goods. Each of these lines of production in turn could be based on a wide range of different technologies, from the simplest to the most sophisticated. The task in every case would be to find an intermediate technology which obtains a fair level of productivity without having to resort to the purchase of expensive and sophisticated equipment. The outcome of the whole venture would be an economic development going far beyond the completion of the initial earth-moving Project. With a total input of capital from outside which might be much smaller than would have been involved in the acquisition of the most modern earth-moving equipment, and an input of (previously unemployed) labour much greater than the modern method would have demanded, not only a given project would have been completed, but a whole community would have been set on the path of development.I say, therefore, that the dynamic approach to development, which treats the choice of appropriate, intermediate technologies as the central issue, opens up avenues of constructive action, which the static, econometric approach totally fails to recognise. This leads to the next objection which has been raised against the idea of intermediate technology. It is argued that all this might be quite promising if it were not for a notorious shortage of entrepreneurial ability in the under-developed countries. This scarce resource should therefore be utilised in the most concentrated way, in places where it has the best chances of success and should be endowed with the finest capital equipment the world can offer. Industry, it is thus argued, should be established in or near the big cities, in large integrated units, and on the highest possible level of capitalisation per workplace.The argument hinges on the assumption that entrepreneurial ability is a fixed and given quantity, and thus again betrays a purely static point of view. It is, of course, neither fixed nor given, being largely a function of the technology to be employed. Men, quite incapable of acting as entrepreneurs on the level of modern technology, may nonetheless be fully capable of making a success of a small-scale enterprise set up on the basis of intermediate technology - for reasons already explained above. In fact, it seems to me, that the apparent shortage of entrepreneurs in many developing countries today is precisely the result of the negative demonstration effect of a sophisticated technology infiltrated into an unsophisticated environment. The introduction of an appropriate, intermediate technology would not be likely to founder on any shortage of entrepreneurial ability. Nor would it diminish the supply of entrepreneurs for enterprises in the modem sector; on the contrary, by spreading familiarity with systematic, technical modes of production over the entire population it would undoubtedly help to increase the supply of the required talent.Q.As used in the last paragraph, which of the following would be an appropriate example of a ‘demonstration effect’?A. Ethics and value systems of a society influence the level of entrepreneurship.B. Parents taking care of their parents.C. Odisha adopting the Bihar model for economic policies.D. The American War of Independence influencing the French Revolution.a)A and C onlyb)A onlyc)B, C and D onlyd)C and D onlyCorrect answer is option 'C'. Can you explain this answer?.

Solutions for DIRECTIONS for the question:Read the passage and answer the question based on it.Let us consider a very simple example. Some earth-moving job has to be done in an area of high unemployment. There is a wide choice of technologies, ranging from the most modern earth- moving equipment to purely manual work without tools of any kind. The output is fixed by the nature of the job, and it is quite clear that the capital / output ratio will be highest, if the input of capital is kept lowest. If the job were done without any tools, the capital/output ratio would be infinitely large, but the productivity per man would be exceedingly low. If the job were done at the highest level of modern technology, the capital/output ratio would be low and the productivity per man very high.Neither of these extremes is desirable, and a middle way has to be found. Assume some of the unemployed men were first set to work to make a variety of tools, including wheel-barrows and the like, while others were made to produce various wages goods. Each of these lines of production in turn could be based on a wide range of different technologies, from the simplest to the most sophisticated. The task in every case would be to find an intermediate technology which obtains a fair level of productivity without having to resort to the purchase of expensive and sophisticated equipment. The outcome of the whole venture would be an economic development going far beyond the completion of the initial earth-moving Project. With a total input of capital from outside which might be much smaller than would have been involved in the acquisition of the most modern earth-moving equipment, and an input of (previously unemployed) labour much greater than the modern method would have demanded, not only a given project would have been completed, but a whole community would have been set on the path of development.I say, therefore, that the dynamic approach to development, which treats the choice of appropriate, intermediate technologies as the central issue, opens up avenues of constructive action, which the static, econometric approach totally fails to recognise. This leads to the next objection which has been raised against the idea of intermediate technology. It is argued that all this might be quite promising if it were not for a notorious shortage of entrepreneurial ability in the under-developed countries. This scarce resource should therefore be utilised in the most concentrated way, in places where it has the best chances of success and should be endowed with the finest capital equipment the world can offer. Industry, it is thus argued, should be established in or near the big cities, in large integrated units, and on the highest possible level of capitalisation per workplace.The argument hinges on the assumption that entrepreneurial ability is a fixed and given quantity, and thus again betrays a purely static point of view. It is, of course, neither fixed nor given, being largely a function of the technology to be employed. Men, quite incapable of acting as entrepreneurs on the level of modern technology, may nonetheless be fully capable of making a success of a small-scale enterprise set up on the basis of intermediate technology - for reasons already explained above. In fact, it seems to me, that the apparent shortage of entrepreneurs in many developing countries today is precisely the result of the negative demonstration effect of a sophisticated technology infiltrated into an unsophisticated environment. The introduction of an appropriate, intermediate technology would not be likely to founder on any shortage of entrepreneurial ability. Nor would it diminish the supply of entrepreneurs for enterprises in the modem sector; on the contrary, by spreading familiarity with systematic, technical modes of production over the entire population it would undoubtedly help to increase the supply of the required talent.Q.As used in the last paragraph, which of the following would be an appropriate example of a ‘demonstration effect’?A. Ethics and value systems of a society influence the level of entrepreneurship.B. Parents taking care of their parents.C. Odisha adopting the Bihar model for economic policies.D. The American War of Independence influencing the French Revolution.a)A and C onlyb)A onlyc)B, C and D onlyd)C and D onlyCorrect answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for CAT. Download more important topics, notes, lectures and mock test series for CAT Exam by signing up for free.

Here you can find the meaning of DIRECTIONS for the question:Read the passage and answer the question based on it.Let us consider a very simple example. Some earth-moving job has to be done in an area of high unemployment. There is a wide choice of technologies, ranging from the most modern earth- moving equipment to purely manual work without tools of any kind. The output is fixed by the nature of the job, and it is quite clear that the capital / output ratio will be highest, if the input of capital is kept lowest. If the job were done without any tools, the capital/output ratio would be infinitely large, but the productivity per man would be exceedingly low. If the job were done at the highest level of modern technology, the capital/output ratio would be low and the productivity per man very high.Neither of these extremes is desirable, and a middle way has to be found. Assume some of the unemployed men were first set to work to make a variety of tools, including wheel-barrows and the like, while others were made to produce various wages goods. Each of these lines of production in turn could be based on a wide range of different technologies, from the simplest to the most sophisticated. The task in every case would be to find an intermediate technology which obtains a fair level of productivity without having to resort to the purchase of expensive and sophisticated equipment. The outcome of the whole venture would be an economic development going far beyond the completion of the initial earth-moving Project. With a total input of capital from outside which might be much smaller than would have been involved in the acquisition of the most modern earth-moving equipment, and an input of (previously unemployed) labour much greater than the modern method would have demanded, not only a given project would have been completed, but a whole community would have been set on the path of development.I say, therefore, that the dynamic approach to development, which treats the choice of appropriate, intermediate technologies as the central issue, opens up avenues of constructive action, which the static, econometric approach totally fails to recognise. This leads to the next objection which has been raised against the idea of intermediate technology. It is argued that all this might be quite promising if it were not for a notorious shortage of entrepreneurial ability in the under-developed countries. This scarce resource should therefore be utilised in the most concentrated way, in places where it has the best chances of success and should be endowed with the finest capital equipment the world can offer. Industry, it is thus argued, should be established in or near the big cities, in large integrated units, and on the highest possible level of capitalisation per workplace.The argument hinges on the assumption that entrepreneurial ability is a fixed and given quantity, and thus again betrays a purely static point of view. It is, of course, neither fixed nor given, being largely a function of the technology to be employed. Men, quite incapable of acting as entrepreneurs on the level of modern technology, may nonetheless be fully capable of making a success of a small-scale enterprise set up on the basis of intermediate technology - for reasons already explained above. In fact, it seems to me, that the apparent shortage of entrepreneurs in many developing countries today is precisely the result of the negative demonstration effect of a sophisticated technology infiltrated into an unsophisticated environment. The introduction of an appropriate, intermediate technology would not be likely to founder on any shortage of entrepreneurial ability. Nor would it diminish the supply of entrepreneurs for enterprises in the modem sector; on the contrary, by spreading familiarity with systematic, technical modes of production over the entire population it would undoubtedly help to increase the supply of the required talent.Q.As used in the last paragraph, which of the following would be an appropriate example of a ‘demonstration effect’?A. Ethics and value systems of a society influence the level of entrepreneurship.B. Parents taking care of their parents.C. Odisha adopting the Bihar model for economic policies.D. The American War of Independence influencing the French Revolution.a)A and C onlyb)A onlyc)B, C and D onlyd)C and D onlyCorrect answer is option 'C'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of DIRECTIONS for the question:Read the passage and answer the question based on it.Let us consider a very simple example. Some earth-moving job has to be done in an area of high unemployment. There is a wide choice of technologies, ranging from the most modern earth- moving equipment to purely manual work without tools of any kind. The output is fixed by the nature of the job, and it is quite clear that the capital / output ratio will be highest, if the input of capital is kept lowest. If the job were done without any tools, the capital/output ratio would be infinitely large, but the productivity per man would be exceedingly low. If the job were done at the highest level of modern technology, the capital/output ratio would be low and the productivity per man very high.Neither of these extremes is desirable, and a middle way has to be found. Assume some of the unemployed men were first set to work to make a variety of tools, including wheel-barrows and the like, while others were made to produce various wages goods. Each of these lines of production in turn could be based on a wide range of different technologies, from the simplest to the most sophisticated. The task in every case would be to find an intermediate technology which obtains a fair level of productivity without having to resort to the purchase of expensive and sophisticated equipment. The outcome of the whole venture would be an economic development going far beyond the completion of the initial earth-moving Project. With a total input of capital from outside which might be much smaller than would have been involved in the acquisition of the most modern earth-moving equipment, and an input of (previously unemployed) labour much greater than the modern method would have demanded, not only a given project would have been completed, but a whole community would have been set on the path of development.I say, therefore, that the dynamic approach to development, which treats the choice of appropriate, intermediate technologies as the central issue, opens up avenues of constructive action, which the static, econometric approach totally fails to recognise. This leads to the next objection which has been raised against the idea of intermediate technology. It is argued that all this might be quite promising if it were not for a notorious shortage of entrepreneurial ability in the under-developed countries. This scarce resource should therefore be utilised in the most concentrated way, in places where it has the best chances of success and should be endowed with the finest capital equipment the world can offer. Industry, it is thus argued, should be established in or near the big cities, in large integrated units, and on the highest possible level of capitalisation per workplace.The argument hinges on the assumption that entrepreneurial ability is a fixed and given quantity, and thus again betrays a purely static point of view. It is, of course, neither fixed nor given, being largely a function of the technology to be employed. Men, quite incapable of acting as entrepreneurs on the level of modern technology, may nonetheless be fully capable of making a success of a small-scale enterprise set up on the basis of intermediate technology - for reasons already explained above. In fact, it seems to me, that the apparent shortage of entrepreneurs in many developing countries today is precisely the result of the negative demonstration effect of a sophisticated technology infiltrated into an unsophisticated environment. The introduction of an appropriate, intermediate technology would not be likely to founder on any shortage of entrepreneurial ability. Nor would it diminish the supply of entrepreneurs for enterprises in the modem sector; on the contrary, by spreading familiarity with systematic, technical modes of production over the entire population it would undoubtedly help to increase the supply of the required talent.Q.As used in the last paragraph, which of the following would be an appropriate example of a ‘demonstration effect’?A. Ethics and value systems of a society influence the level of entrepreneurship.B. Parents taking care of their parents.C. Odisha adopting the Bihar model for economic policies.D. The American War of Independence influencing the French Revolution.a)A and C onlyb)A onlyc)B, C and D onlyd)C and D onlyCorrect answer is option 'C'. Can you explain this answer?, a detailed solution for DIRECTIONS for the question:Read the passage and answer the question based on it.Let us consider a very simple example. Some earth-moving job has to be done in an area of high unemployment. There is a wide choice of technologies, ranging from the most modern earth- moving equipment to purely manual work without tools of any kind. The output is fixed by the nature of the job, and it is quite clear that the capital / output ratio will be highest, if the input of capital is kept lowest. If the job were done without any tools, the capital/output ratio would be infinitely large, but the productivity per man would be exceedingly low. If the job were done at the highest level of modern technology, the capital/output ratio would be low and the productivity per man very high.Neither of these extremes is desirable, and a middle way has to be found. Assume some of the unemployed men were first set to work to make a variety of tools, including wheel-barrows and the like, while others were made to produce various wages goods. Each of these lines of production in turn could be based on a wide range of different technologies, from the simplest to the most sophisticated. The task in every case would be to find an intermediate technology which obtains a fair level of productivity without having to resort to the purchase of expensive and sophisticated equipment. The outcome of the whole venture would be an economic development going far beyond the completion of the initial earth-moving Project. With a total input of capital from outside which might be much smaller than would have been involved in the acquisition of the most modern earth-moving equipment, and an input of (previously unemployed) labour much greater than the modern method would have demanded, not only a given project would have been completed, but a whole community would have been set on the path of development.I say, therefore, that the dynamic approach to development, which treats the choice of appropriate, intermediate technologies as the central issue, opens up avenues of constructive action, which the static, econometric approach totally fails to recognise. This leads to the next objection which has been raised against the idea of intermediate technology. It is argued that all this might be quite promising if it were not for a notorious shortage of entrepreneurial ability in the under-developed countries. This scarce resource should therefore be utilised in the most concentrated way, in places where it has the best chances of success and should be endowed with the finest capital equipment the world can offer. Industry, it is thus argued, should be established in or near the big cities, in large integrated units, and on the highest possible level of capitalisation per workplace.The argument hinges on the assumption that entrepreneurial ability is a fixed and given quantity, and thus again betrays a purely static point of view. It is, of course, neither fixed nor given, being largely a function of the technology to be employed. Men, quite incapable of acting as entrepreneurs on the level of modern technology, may nonetheless be fully capable of making a success of a small-scale enterprise set up on the basis of intermediate technology - for reasons already explained above. In fact, it seems to me, that the apparent shortage of entrepreneurs in many developing countries today is precisely the result of the negative demonstration effect of a sophisticated technology infiltrated into an unsophisticated environment. The introduction of an appropriate, intermediate technology would not be likely to founder on any shortage of entrepreneurial ability. Nor would it diminish the supply of entrepreneurs for enterprises in the modem sector; on the contrary, by spreading familiarity with systematic, technical modes of production over the entire population it would undoubtedly help to increase the supply of the required talent.Q.As used in the last paragraph, which of the following would be an appropriate example of a ‘demonstration effect’?A. Ethics and value systems of a society influence the level of entrepreneurship.B. Parents taking care of their parents.C. Odisha adopting the Bihar model for economic policies.D. The American War of Independence influencing the French Revolution.a)A and C onlyb)A onlyc)B, C and D onlyd)C and D onlyCorrect answer is option 'C'. Can you explain this answer? has been provided alongside types of DIRECTIONS for the question:Read the passage and answer the question based on it.Let us consider a very simple example. Some earth-moving job has to be done in an area of high unemployment. There is a wide choice of technologies, ranging from the most modern earth- moving equipment to purely manual work without tools of any kind. The output is fixed by the nature of the job, and it is quite clear that the capital / output ratio will be highest, if the input of capital is kept lowest. If the job were done without any tools, the capital/output ratio would be infinitely large, but the productivity per man would be exceedingly low. If the job were done at the highest level of modern technology, the capital/output ratio would be low and the productivity per man very high.Neither of these extremes is desirable, and a middle way has to be found. Assume some of the unemployed men were first set to work to make a variety of tools, including wheel-barrows and the like, while others were made to produce various wages goods. Each of these lines of production in turn could be based on a wide range of different technologies, from the simplest to the most sophisticated. The task in every case would be to find an intermediate technology which obtains a fair level of productivity without having to resort to the purchase of expensive and sophisticated equipment. The outcome of the whole venture would be an economic development going far beyond the completion of the initial earth-moving Project. With a total input of capital from outside which might be much smaller than would have been involved in the acquisition of the most modern earth-moving equipment, and an input of (previously unemployed) labour much greater than the modern method would have demanded, not only a given project would have been completed, but a whole community would have been set on the path of development.I say, therefore, that the dynamic approach to development, which treats the choice of appropriate, intermediate technologies as the central issue, opens up avenues of constructive action, which the static, econometric approach totally fails to recognise. This leads to the next objection which has been raised against the idea of intermediate technology. It is argued that all this might be quite promising if it were not for a notorious shortage of entrepreneurial ability in the under-developed countries. This scarce resource should therefore be utilised in the most concentrated way, in places where it has the best chances of success and should be endowed with the finest capital equipment the world can offer. Industry, it is thus argued, should be established in or near the big cities, in large integrated units, and on the highest possible level of capitalisation per workplace.The argument hinges on the assumption that entrepreneurial ability is a fixed and given quantity, and thus again betrays a purely static point of view. It is, of course, neither fixed nor given, being largely a function of the technology to be employed. Men, quite incapable of acting as entrepreneurs on the level of modern technology, may nonetheless be fully capable of making a success of a small-scale enterprise set up on the basis of intermediate technology - for reasons already explained above. In fact, it seems to me, that the apparent shortage of entrepreneurs in many developing countries today is precisely the result of the negative demonstration effect of a sophisticated technology infiltrated into an unsophisticated environment. The introduction of an appropriate, intermediate technology would not be likely to founder on any shortage of entrepreneurial ability. Nor would it diminish the supply of entrepreneurs for enterprises in the modem sector; on the contrary, by spreading familiarity with systematic, technical modes of production over the entire population it would undoubtedly help to increase the supply of the required talent.Q.As used in the last paragraph, which of the following would be an appropriate example of a ‘demonstration effect’?A. Ethics and value systems of a society influence the level of entrepreneurship.B. Parents taking care of their parents.C. Odisha adopting the Bihar model for economic policies.D. The American War of Independence influencing the French Revolution.a)A and C onlyb)A onlyc)B, C and D onlyd)C and D onlyCorrect answer is option 'C'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice DIRECTIONS for the question:Read the passage and answer the question based on it.Let us consider a very simple example. Some earth-moving job has to be done in an area of high unemployment. There is a wide choice of technologies, ranging from the most modern earth- moving equipment to purely manual work without tools of any kind. The output is fixed by the nature of the job, and it is quite clear that the capital / output ratio will be highest, if the input of capital is kept lowest. If the job were done without any tools, the capital/output ratio would be infinitely large, but the productivity per man would be exceedingly low. If the job were done at the highest level of modern technology, the capital/output ratio would be low and the productivity per man very high.Neither of these extremes is desirable, and a middle way has to be found. Assume some of the unemployed men were first set to work to make a variety of tools, including wheel-barrows and the like, while others were made to produce various wages goods. Each of these lines of production in turn could be based on a wide range of different technologies, from the simplest to the most sophisticated. The task in every case would be to find an intermediate technology which obtains a fair level of productivity without having to resort to the purchase of expensive and sophisticated equipment. The outcome of the whole venture would be an economic development going far beyond the completion of the initial earth-moving Project. With a total input of capital from outside which might be much smaller than would have been involved in the acquisition of the most modern earth-moving equipment, and an input of (previously unemployed) labour much greater than the modern method would have demanded, not only a given project would have been completed, but a whole community would have been set on the path of development.I say, therefore, that the dynamic approach to development, which treats the choice of appropriate, intermediate technologies as the central issue, opens up avenues of constructive action, which the static, econometric approach totally fails to recognise. This leads to the next objection which has been raised against the idea of intermediate technology. It is argued that all this might be quite promising if it were not for a notorious shortage of entrepreneurial ability in the under-developed countries. This scarce resource should therefore be utilised in the most concentrated way, in places where it has the best chances of success and should be endowed with the finest capital equipment the world can offer. Industry, it is thus argued, should be established in or near the big cities, in large integrated units, and on the highest possible level of capitalisation per workplace.The argument hinges on the assumption that entrepreneurial ability is a fixed and given quantity, and thus again betrays a purely static point of view. It is, of course, neither fixed nor given, being largely a function of the technology to be employed. Men, quite incapable of acting as entrepreneurs on the level of modern technology, may nonetheless be fully capable of making a success of a small-scale enterprise set up on the basis of intermediate technology - for reasons already explained above. In fact, it seems to me, that the apparent shortage of entrepreneurs in many developing countries today is precisely the result of the negative demonstration effect of a sophisticated technology infiltrated into an unsophisticated environment. The introduction of an appropriate, intermediate technology would not be likely to founder on any shortage of entrepreneurial ability. Nor would it diminish the supply of entrepreneurs for enterprises in the modem sector; on the contrary, by spreading familiarity with systematic, technical modes of production over the entire population it would undoubtedly help to increase the supply of the required talent.Q.As used in the last paragraph, which of the following would be an appropriate example of a ‘demonstration effect’?A. Ethics and value systems of a society influence the level of entrepreneurship.B. Parents taking care of their parents.C. Odisha adopting the Bihar model for economic policies.D. The American War of Independence influencing the French Revolution.a)A and C onlyb)A onlyc)B, C and D onlyd)C and D onlyCorrect answer is option 'C'. Can you explain this answer? tests, examples and also practice CAT tests.