When is GDP growth more likely to reduce poverty?
Answer and explanation
Correct answer: When growth creates employment and income opportunities
GDP growth is more likely to reduce poverty when it is broad-based and creates productive employment, higher earnings, and income opportunities for poorer households. Employment allows people to earn directly, while public revenue can support useful services and social protection. Therefore option B is correct. Falling employment, concentrated gains, and declining public services weaken the connection between aggregate growth and poverty reduction, so options A, C, and D are unsuitable.
Frequently asked questions
What is the correct answer to this question?
When growth creates employment and income opportunities
Why is this the correct answer?
GDP growth is more likely to reduce poverty when it is broad-based and creates productive employment, higher earnings, and income opportunities for poorer households. Employment allows people to earn directly, while public revenue can support useful services and social protection. Therefore option B is correct. Falling employment, concentrated gains, and declining public services weaken the connection between aggregate growth and poverty reduction, so options A, C, and D are unsuitable.
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.
