What may cause low welfare even in a country with high GDP?
Answer and explanation
Correct answer: Extreme income inequality
GDP measures the total value of production, but it does not show how income and benefits are distributed among citizens. If extreme income inequality exists, a large share of national income may go to a small group while many people lack adequate food, healthcare, education or housing. High literacy, a clean environment and accessible healthcare generally support welfare, so option D is correct.
Frequently asked questions
What is the correct answer to this question?
Extreme income inequality
Why is this the correct answer?
GDP measures the total value of production, but it does not show how income and benefits are distributed among citizens. If extreme income inequality exists, a large share of national income may go to a small group while many people lack adequate food, healthcare, education or housing. High literacy, a clean environment and accessible healthcare generally support welfare, so option D 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.
