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What does it indicate if the poverty rate rises along with GDP growth?

Answer and explanation

Correct answer: Benefits of economic growth were not broadly distributed

The key concept is inclusive growth: an economy can produce more while the gains go mainly to higher-income groups or fail to reach vulnerable households. If GDP rises but the poverty rate also rises, average output has increased without sufficient improvement in the position of the poor. Thus, option A is the balanced inference. B contradicts the premise, while C and D are unsupported or false.

Related tags

PovertyInclusive GrowthGdp GrowthGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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