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Why may broad welfare remain limited if output growth mainly consists of goods bought only by high-income groups?

Answer and explanation

Correct answer: Because the composition of output does not meet the needs of the majority

The governing concept is that the composition and distribution of output matter for welfare, not merely its total value. If growth is concentrated in luxury goods purchased by rich households, most people may receive little benefit and basic needs may remain unmet. Therefore option B is correct. Final goods are not excluded from GDP, and the question gives no basis for claims about population or imports.

Related tags

Composition Of OutputLuxury GoodsBroad WelfareDistributionGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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