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In a country, traffic congestion and commuting time rise sharply along with total output. Why should commuting time be included in welfare analysis?

Answer and explanation

Correct answer: Because loss of time may reduce quality of life, but it is not directly deducted from GDP

GDP measures the market value of produced goods and services, but it does not directly subtract unpaid time lost in congestion, reduced leisure, stress, or fatigue. Thus, output can rise while quality of life and welfare decline. Option B is correct. A is too strong because commuting expenditure may itself support measured production; C and D make unsupported claims about congestion and exports.

Related tags

Gdp-And-WelfareTraffic-CongestionCommuting-TimeQuality-Of-LifeGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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