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Which of the following is a benefit of production that may not be fully measured in GDP?

Answer and explanation

Correct answer: Spread of knowledge in society

GDP is mainly based on recorded market transactions and the value of final goods and services. Knowledge created by production can spread to other people and firms, improving their productivity or understanding without a separate payment. This positive spillover is a benefit whose full value may not appear in market prices or GDP. Therefore option C is correct. Prices, wages, and profits are directly recorded monetary components of production.

Related tags

Knowledge SpilloverPositive ExternalityGdp LimitationUnmeasured BenefitsGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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