If real per capita GDP rises and income inequality falls what can generally be expected?
Answer and explanation
Correct answer: Improvement in broad welfare
The governing concept is inclusive welfare: real per capita GDP reflects inflation-adjusted output per person, while lower inequality suggests that gains are distributed more broadly. When both indicators improve, living standards are generally expected to improve for a larger share of the population, making option A correct. The other choices contradict the information or introduce unrelated claims about prices and population.
Frequently asked questions
What is the correct answer to this question?
Improvement in broad welfare
Why is this the correct answer?
The governing concept is inclusive welfare: real per capita GDP reflects inflation-adjusted output per person, while lower inequality suggests that gains are distributed more broadly. When both indicators improve, living standards are generally expected to improve for a larger share of the population, making option A correct. The other choices contradict the information or introduce unrelated claims about prices and population.
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.
