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If income distribution is perfectly equal and real GDP per capita rises will welfare definitely rise?

Answer and explanation

Correct answer: No because factors such as environment health leisure and freedom may also change

The governing concept is that real GDP per capita is only a partial indicator of welfare. Perfect equality removes the distribution problem, and higher real output may increase access to goods, but welfare also depends on environmental quality, health, leisure, security, freedom, and the quality of goods. Therefore option B is correct; A and C wrongly treat GDP as complete, while D wrongly denies the usefulness of real GDP.

Related tags

Gdp And WelfareIncome DistributionNon-Monetary FactorsNational Income And Related AggregatesEconomicsClass 11 Mcq

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