The quantity of goods remains the same but more goods are produced to meet the needs of the poor. What may happen to welfare?
Answer and explanation
Correct answer: Welfare may rise
Welfare depends not only on the total quantity of output but also on its composition and distribution. If production is increasingly directed toward food, clothing, housing, health, or other necessities for poor households, their basic needs may be met more effectively. Their living conditions and welfare can therefore improve even if aggregate output is unchanged. Option A is correct because it says “may rise”; the other options make unsupported absolute claims or wrongly dismiss composition.
Frequently asked questions
What is the correct answer to this question?
Welfare may rise
Why is this the correct answer?
Welfare depends not only on the total quantity of output but also on its composition and distribution. If production is increasingly directed toward food, clothing, housing, health, or other necessities for poor households, their basic needs may be met more effectively. Their living conditions and welfare can therefore improve even if aggregate output is unchanged. Option A is correct because it says “may rise”; the other options make unsupported absolute claims or wrongly dismiss composition.
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.
