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Which aspect represents a welfare limitation of NNP?

Answer and explanation

Correct answer: It does not fully show income distribution

NNP measures the net value of goods and services produced, but it does not show how income is distributed among households. Two countries can have the same NNP but very different levels of income equality. Therefore, NNP alone cannot give a complete picture of economic welfare.

Related tags

EconomicsNnpWelfareIncome DistributionGdp And WelfareNational Income And Related AggregatesClass 11 Mcq

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