Which is the most scientific way to relate GDP to public welfare?
Answer and explanation
Correct answer: Studying distribution health education environment and leisure along with real per capita GDP
GDP measures the market value of final goods and services, but it is not a complete measure of welfare. Real per capita GDP adjusts output for population and price changes, while distribution, health, education, environmental quality, security and leisure reveal how people actually experience development. Therefore, option B is correct. Total or nominal GDP alone can rise because of population growth or inflation, even when average living conditions do not improve.
Frequently asked questions
What is the correct answer to this question?
Studying distribution health education environment and leisure along with real per capita GDP
Why is this the correct answer?
GDP measures the market value of final goods and services, but it is not a complete measure of welfare. Real per capita GDP adjusts output for population and price changes, while distribution, health, education, environmental quality, security and leisure reveal how people actually experience development. Therefore, option B is correct. Total or nominal GDP alone can rise because of population growth or inflation, even when average living conditions do not improve.
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.
