Economics
GDP and Welfare
Practice questions
If household members provide unpaid cooking and later the same service is purchased from the market, what will change?After a natural disaster, reconstruction expenditure rises sharply. Why can a welfare conclusion based only on higher GDP be misleading?Under which condition will real GDP per capita increase?If nominal GDP rises while real GDP remains constant, what can be said about welfare?The government provides clean drinking water free of charge, and its production cost is included in GDP. Why is precise welfare assessment still difficult?A country’s real GDP grows by 10%, but its population grows by 12%. What happens to the indicator of average economic welfare?Which comparison is especially affected because GDP excludes the value of leisure time?If a family replaces self-provided child care with paid child-care services, what measurement issue arises for GDP and welfare?Excessive groundwater extraction raises current production but reduces future water availability. Which limitation of GDP does this illustrate?Which example shows that GDP growth provides no information about income distribution?Why is real GDP per capita an incomplete indicator of living standards?If spending on security services rises because crime increases, what divergence may occur between GDP and welfare?Which of the following is excluded from GDP but can increase economic welfare?Why may the average citizen's consumption capacity fall despite an increase in real GDP?How does green GDP seek to adjust conventional GDP?If traffic congestion raises fuel consumption and vehicle-repair expenditure in a city, what is possible?Under which condition is current welfare likely to be higher despite equal real GDP?A country's GDP rises because weapons production increases. Why does this not automatically imply higher citizen welfare?Which change can increase welfare without affecting GDP?What does the exclusion of resale of a used good imply for welfare analysis?