If workplace accidents rise sharply along with output growth which assessment of GDP and welfare is correct?
Answer and explanation
Correct answer: GDP may rise but health losses and risk may make the welfare gain small or negative
GDP records the value of market production and does not automatically deduct pain, injury, lost health, fear, or the full social cost of workplace accidents. Consequently, output can increase while the associated health losses and risks offset part or all of the welfare gain. Option D is correct. The other choices either claim automatic deduction, deny relevant harm, or assume that higher output must benefit everyone.
Frequently asked questions
What is the correct answer to this question?
GDP may rise but health losses and risk may make the welfare gain small or negative
Why is this the correct answer?
GDP records the value of market production and does not automatically deduct pain, injury, lost health, fear, or the full social cost of workplace accidents. Consequently, output can increase while the associated health losses and risks offset part or all of the welfare gain. Option D is correct. The other choices either claim automatic deduction, deny relevant harm, or assume that higher output must benefit everyone.
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.
