What is the likely effect if access to public parks and clean air increases?
Answer and explanation
Correct answer: Welfare may rise even if its full value is not shown in GDP
Public parks and clean air are environmental amenities that can improve health, leisure, mental well-being and quality of life. Their benefits may be provided without a direct market price, so GDP may not record their full value. This illustrates why GDP is not a complete measure of welfare. The other options are extreme claims with no necessary connection to better environmental conditions; therefore C is correct.
Frequently asked questions
What is the correct answer to this question?
Welfare may rise even if its full value is not shown in GDP
Why is this the correct answer?
Public parks and clean air are environmental amenities that can improve health, leisure, mental well-being and quality of life. Their benefits may be provided without a direct market price, so GDP may not record their full value. This illustrates why GDP is not a complete measure of welfare. The other options are extreme claims with no necessary connection to better environmental conditions; therefore C is correct.
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.
