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Why is it difficult to assess environmental conditions accurately from GDP?

Answer and explanation

Correct answer: The full value of environmental damage is not recorded in it

GDP records the market value of current production, but it does not fully subtract pollution, loss of biodiversity, or depletion of natural resources. Production can therefore increase while environmental quality and long-term welfare decline. Option D is correct because the unpriced or incompletely priced damage is missing from the headline GDP figure. The other options wrongly deny environmental importance or make an absolute claim about resources.

Related tags

Gdp LimitationEnvironmental DamageNatural ResourcesWelfareGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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