What does GDP reveal about the distribution of income?
Answer and explanation
Correct answer: It does not itself show income distribution
GDP is an aggregate measure of the total value of final goods and services produced within an economy during a period. It says how large total production is, but not how that income is shared among households or groups. Two economies can have the same GDP while one is highly unequal and the other is more balanced. Therefore option D is correct; GDP alone cannot prove equality or identify poverty numbers.
Frequently asked questions
What is the correct answer to this question?
It does not itself show income distribution
Why is this the correct answer?
GDP is an aggregate measure of the total value of final goods and services produced within an economy during a period. It says how large total production is, but not how that income is shared among households or groups. Two economies can have the same GDP while one is highly unequal and the other is more balanced. Therefore option D is correct; GDP alone cannot prove equality or identify poverty numbers.
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.
