When the automobile replaced horse-drawn carriages as the principal means of transportation,firms producing horse-drawn carriages went bankrupt and permanently laid off all their workers,thereby increasing
I.seasonal unemployment.
Ii.structural unemployment.
Iii.cyclical unemployment.

Question

Quizplus · Accepted Answer

The introduction of automobiles caused structural unemployment in the firms producing horse-drawn carriages, as their industry became obsolete and they were unable to adapt to the new technology. This type of unemployment is due to changes in the structure of the economy and not related to fluctuations in the business cycle (cyclical) or seasonal patterns. Therefore, option ii is the only correct choice. Option i is incorrect because seasonal unemployment is related to seasonal variations in demand for labor (e.g. agriculture, tourism), and option iii is incorrect because cyclical unemployment is associated with downturns in the business cycle.

When the Automobile Replaced Horse-Drawn Carriages as the Principal Means