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In which situation can consumer welfare improve without an increase in measured GDP?

Answer and explanation

Correct answer: Product quality improves while its price stays the same

A product of better quality at the same price can give consumers greater satisfaction, even if recorded spending and measured GDP do not rise. Thus consumer welfare can improve without an increase in measured GDP, making option D correct.

Related tags

Consumer WelfareProduct QualityGdp LimitationsUtilityGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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