A country reduced the working week while keeping output unchanged. What is the likely effect on welfare?
Answer and explanation
Correct answer: Welfare may rise because of more leisure
Welfare is broader than measured production and includes the use of time. If the same output is produced with a shorter working week, people may gain additional leisure for rest, family, education or recreation. This non-monetary benefit can raise quality of life, although the exact effect depends on wages and working conditions. A is correct; unchanged output does not make GDP zero, and the other outcomes are not necessary.
Frequently asked questions
What is the correct answer to this question?
Welfare may rise because of more leisure
Why is this the correct answer?
Welfare is broader than measured production and includes the use of time. If the same output is produced with a shorter working week, people may gain additional leisure for rest, family, education or recreation. This non-monetary benefit can raise quality of life, although the exact effect depends on wages and working conditions. A is correct; unchanged output does not make GDP zero, and the other outcomes are not necessary.
Which subject and chapter does this question cover?
This is a Class 11 Economics question. Chapter: National Income and Related Aggregates. Topic: GDP and Welfare.
