If a country’s GDP rises but democratic freedom and personal safety decline, what is the conclusion about welfare?
Answer and explanation
Correct answer: Non-economic welfare may decline
GDP is a monetary measure of market production within an economy; it does not directly measure civil liberties, political participation, personal security, or dignity. Thus, rising GDP can coexist with a deterioration in important non-economic dimensions of life. Option D is the balanced conclusion: economic production may have increased while broader human or non-economic welfare declined. A is too certain, B is conceptually false, and C does not follow because the GDP calculation may still be accurate.
Frequently asked questions
What is the correct answer to this question?
Non-economic welfare may decline
Why is this the correct answer?
GDP is a monetary measure of market production within an economy; it does not directly measure civil liberties, political participation, personal security, or dignity. Thus, rising GDP can coexist with a deterioration in important non-economic dimensions of life. Option D is the balanced conclusion: economic production may have increased while broader human or non-economic welfare declined. A is too certain, B is conceptually false, and C does not follow because the GDP calculation may still be accurate.
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.
