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Consider the following statements about the Micro Small and Medium Enterprises (MSMEs):
1. This sector is the largest employer of human resources in India.
2. It generates more employment opportunities per unit of capital invested compared to large industries.
Which of the statements given above is/are correct?
- a)1 only
- b)2 only
- c)Both 1 and 2
- d)Neither 1 nor 2
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
Consider the following statements about the Micro Small and Medium Ent...
The correct answer is option 'B': 2 only.
Explanation:
• The Micro Small and Medium Enterprises (MSMEs) sector plays a crucial role in the Indian economy. It is responsible for the generation of employment opportunities and contributes significantly to the country's GDP.
• Statement 1: This sector is the largest employer of human resources in India.
- This statement is incorrect. While the MSME sector is an important source of employment, it is not the largest employer of human resources in India. The agriculture sector, followed by the services sector, employ a larger number of people.
• Statement 2: It generates more employment opportunities per unit of capital invested compared to large industries.
- This statement is correct. MSMEs have a higher employment elasticity compared to large industries. They are more labor-intensive and tend to generate more employment opportunities with the same amount of capital investment. This is because MSMEs typically operate on a smaller scale and require less capital-intensive technology.
- MSMEs are known to provide employment opportunities to a diverse range of individuals, including those with limited formal education or training. They often function as a source of self-employment and entrepreneurship, especially in rural areas, where job opportunities may be limited.
- The flexibility and adaptability of MSMEs allow them to respond quickly to changing market demands and contribute to economic growth and development.
• Therefore, only statement 2 is correct, and the correct answer is option 'B': 2 only.
Explanation:
• The Micro Small and Medium Enterprises (MSMEs) sector plays a crucial role in the Indian economy. It is responsible for the generation of employment opportunities and contributes significantly to the country's GDP.
• Statement 1: This sector is the largest employer of human resources in India.
- This statement is incorrect. While the MSME sector is an important source of employment, it is not the largest employer of human resources in India. The agriculture sector, followed by the services sector, employ a larger number of people.
• Statement 2: It generates more employment opportunities per unit of capital invested compared to large industries.
- This statement is correct. MSMEs have a higher employment elasticity compared to large industries. They are more labor-intensive and tend to generate more employment opportunities with the same amount of capital investment. This is because MSMEs typically operate on a smaller scale and require less capital-intensive technology.
- MSMEs are known to provide employment opportunities to a diverse range of individuals, including those with limited formal education or training. They often function as a source of self-employment and entrepreneurship, especially in rural areas, where job opportunities may be limited.
- The flexibility and adaptability of MSMEs allow them to respond quickly to changing market demands and contribute to economic growth and development.
• Therefore, only statement 2 is correct, and the correct answer is option 'B': 2 only.
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Consider the following statements about the Micro Small and Medium Enterprises (MSMEs):1. This sector is the largest employer of human resources in India.2. It generates more employment opportunities per unit of capital invested compared to large industries.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer?
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