UGC NTA NET/JRF Exam, December-2024 Economics

Total Questions: 100

91. Find the correct option. Nash Equilibrium occurs when both firms earn:

Consider the following Prisoner's Dilemma Game:

Correct Answer: (a) ($200, $200)
Solution:

The given game is a Prisoner's Dilemma situation between two firms (1 and 2), where each firm has to decide whether to Invest or Not Invest.
The Nash Equilibrium is a situation where no player (firm) can unilaterally increase their payoff by changing their decision.

When one firm in the industry makes a security investment (indicated as "number investment" in the Hindi text), the number of investing firms in the industry increases.

Since Not Investing is the best option for both firms (according to this specific, potentially flawed, analysis), both firms choose Not Invest, and (₹200, ₹200) is the Nash Equilibrium.

The problem of underinvestment in this game can be avoided if the government sets such numerical standards (security standards) that oblige both firms to invest.

92. As a result of security investment by one firm in an industry with two firms :

Correct Answer: (d) The wages of workers decrease in both firms.
Solution:

The provided explanation states that as a result of security investment by one firm in a two-firm industry, the wages of workers decrease in both firms.

93. Investment made by both firms is :

Correct Answer: (c) Not an equilibrium
Solution:

See the explanation for Question 91.

94. The problem of underinvestment in this game can be avoided if :

Correct Answer: (b) The government sets security standards that oblige both firms to invest.
Solution:

See the explanation for Question 91.

95. Choose the correct option. Security investment by one firm in the industry: (a) Increases the security of both firms.

Correct Answer: (b) Increases the security of the investing firm.
Solution:

See the explanation for Question 91.

96. Based on their individual characteristics, social background, economic circumstances, etc., individuals possess the capability to do certain things (or to be certain things) that they have reason to value.

The rationale for valuation (worth-determination) can be direct (e.g., its intrinsic effect on one's life, such as being robust or healthy) or indirect (e.g., its contribution to increasing production or commanding a price in the market through embedded causality).

In theory, both types of valuation can be accommodated in a broadly defined human capital perspective, but typically, its definition is traditionally given primarily in terms of indirect value-that is, human attributes can be utilized in the same way that physical capital is utilized in production.

In this sense, the relatively narrow view of the human capital approach fits precisely within the comprehensive perspective of human capability, which can encompass both the direct and indirect outcomes of human attributes.

For example, if education makes an individual more proficient in the production of a commodity, this is a direct enhancement of human capital. Consequently, the value of production in the economy may increase, and simultaneously, the income of the educated individual may also rise.

However, such an individual can benefit through reading, communication, and reasoning by making more informed choices and can be taken more seriously by others, and many other things can happen.

Thus, the role of the benefits derived from education extends far beyond its role as human capital in commodity production. In the broader human capability perspective (approach), these additional roles are recorded and given importance.

Which of the following concept is not related to human capability?

Correct Answer: (d) Being authoritarian
Solution:

According to the passage, Being authoritarian is not related to human capability. The concepts of being healthy, being proficient in reasoning, and social acceptability are related to the concept of human capability.

97. Providing education to an individual leads to the enhancement of which of the following?

Correct Answer: (c) Both Human Capability and Human Capital
Solution:

Providing education to an individual leads to the enhancement of both Human Capital and Human Capability, because education makes the individual proficient in production (Human Capital) and develops the capacity for making informed decisions.

98. Human Capability and Human Capital are related as follows:

Correct Answer: (b) Human Capability is a higher category compared to Human Capital.
Solution:

"Human capital and human capability are often similar concepts because they relate to an individual's skills (dakshtayein), while capability has a broader social impact."

99. Human Capability is related to :

Correct Answer: (a) Selection of informed choices
Solution:

Human Capability is related to the selection of informed choices, because education, reasoning, and communication skills enable an individual to make better decisions, which increases their social and economic impact.

100. The direct effect of an individual valuing certain activities and certain beings is, for example :

Correct Answer: (c) Life enhancement/enrichment
Solution:

The direct effect of an individual valuing certain actions and certain states of being is life enrichment/enhancement (Jeevan Samvardhan), because it influences health, prosperity, and the overall quality of life, thereby leading to the individual's development.