Which of the following words will fit in the given blank (C)?
In the following passage there are blanks, each of which has been denoted by a letter. For each blank, five options are given. Choose the most appropriate word from the options that fits the blank appropriately.
Economic development and growth are supposed to ______________ (A) the employment situation in a country. Much of development literature _______________ (B) this idea as a major expectation at least from the long-run perspective. It is also the case that the greater the amount of ________________ (C) labour in an economy and the greater the ________________(D) of underemployment, the slower will be the pace of change in the employment structure towards more regular and protected waged forms of employment. In fact, one can only give a proper perspective to the misunderstood policy challenges of __________________ (E) in a developing economy by first examining these matters at the broadest level with existing data.

The correct answer is surplus.

Step-by-Step Explanation:

1. Analyze the Context of Blank (C):
Let us examine the sentence containing blank (C):
"It is also the case that the greater the amount of ________________ (C) labour in an economy and the greater the ________________(D) of underemployment, the slower will be the pace of change in the employment structure towards more regular and protected waged forms of employment."

2. Understand the Logical Meaning:
The sentence discusses factors that slow down the structural shift of employment toward regular and protected jobs in a developing economy. It mentions "underemployment" as a parallel negative factor. In economic terminology, an excess or redundant supply of workforce is referred to as "surplus labour." Having a high amount of surplus labour creates a backlog in the job market, hindering the transition to regular formal employment.

3. Evaluate the Given Options:

• deprive: A verb meaning to deny someone the possession or use of something. It does not grammatically or logically fit as an adjective modifying "labour" here.
• revise: A verb meaning to examine and alter or amend. It makes no sense in the context of describing a type or quantity of labour.
• discharge: Means to tell someone officially that they must or may leave. It does not fit the context of describing the nature of labour supply in an economy.
• surplus: An adjective/noun meaning an amount that is more than necessary or excess. In economics, "surplus labour" is a standard collocations referring to workers who are underemployed or whose marginal productivity is minimal.

Conclusion:
Thus, the word surplus appropriately fills blank (C) both contextually and grammatically.