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What can be said about welfare if excessive weapons production raises GDP?

Answer and explanation

Correct answer: Public welfare will not necessarily rise

GDP measures the value of final production, so weapons output can increase measured GDP when it is produced and sold. However, GDP does not reveal whether the output meets basic human needs, improves security, is equally distributed, or creates opportunity costs by diverting resources from education, health, and consumption. Excessive weapons production may therefore raise GDP without raising overall welfare. Option D is correct.

Related tags

Weapons ProductionComposition Of OutputGdpWelfareGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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