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If GDP growth mainly comes from polluting industries, what conclusion should be drawn about welfare?

Answer and explanation

Correct answer: Welfare may not necessarily increase

Polluting production can raise measured GDP, while pollution may harm health, quality of life, and the environment. Since GDP does not automatically subtract all such damage, GDP growth alone does not establish that welfare has increased.

Related tags

GdpWelfarePollutionGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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