Directions: Study the following information carefully and answer the question given below.
Read the following passage carefully and answer the questions that follow:
The meteoric rise of generative artificial intelligence and autonomous robotics has reignited intense debate surrounding Universal Basic Income (UBI). Historically, technological revolutionsโfrom the steam engine to microprocessorsโdisplaced manual labor while generating compensatory high-skill employment in emergent industrial sectors. However, macroeconomists argue that generative AI represents a general-purpose cognitive technology capable of automating intellectual tasks, including software coding, paralegal document review, financial analysis, and diagnostic imaging. Because cognitive automation advances at an unprecedented algorithmic velocity, the labor market may lack sufficient temporal breathing room to transition millions of displaced white-collar workers into newly created economic niches.
In response to prospective widespread technological unemployment, UBI advocates propose disbursing unconditional, regular cash payments to every citizen, irrespective of income or employment status. Proponents assert that an unconditional income floor would prevent catastrophic poverty, sustain aggregate consumer purchasing power in an automated economy, and empower individuals to pursue creative, educational, or caregiving endeavors. Conversely, fiscal conservatives and orthodox economists contend that a nationwide universal basic income would be prohibitively expensive, necessitating colossal tax increases that could disincentivize entrepreneurship and reduce capital investment. Furthermore, critics warn that severing income from productive economic output risks accelerating wage-push inflation and eroding the fundamental psychological and social dignity traditionally derived from meaningful work.
Why do contemporary macroeconomists argue that generative AI represents a fundamentally different economic disruption compared to past industrial revolutions?
๐ก Solution & Explanation:
Correct Answer: (C)
Core Concept: Reading Comprehension โ Economic Analysis
Step-by-Step Solution:
1. Paragraph 1 explains that past revolutions displaced manual labor and created new roles, but generative AI automates cognitive work at an unprecedented velocity, leaving insufficient time to retrain millions of workers.
2. Option (C) directly summarizes this argument.
3. Options B, C, and D are false.
Key Shortcut / Exam Tip: Cognitive automation velocity exceeds labor market retraining time.