On what basis is the service of a government school teacher measured in NDP?
Answer and explanation
Correct answer: By production cost or compensation of the teacher
Government schooling is generally a non-market service because it is not sold at a normal market price to students. In national accounting, such services are valued by their cost of production, especially the compensation paid to employees such as teachers, along with relevant operating costs. Thus option B is correct. Fees, building value and examination results do not measure the current flow of teaching service.
Frequently asked questions
What is the correct answer to this question?
By production cost or compensation of the teacher
Why is this the correct answer?
Government schooling is generally a non-market service because it is not sold at a normal market price to students. In national accounting, such services are valued by their cost of production, especially the compensation paid to employees such as teachers, along with relevant operating costs. Thus option B is correct. Fees, building value and examination results do not measure the current flow of teaching service.
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.
