Which of the following raises social welfare but may not be fully reflected in GDP?
Answer and explanation
Correct answer: Free disaster relief by volunteers
GDP mainly records market-valued final goods and services, so unpaid work can be omitted or understated. Free disaster relief provided by volunteers can greatly improve safety and welfare, but no market payment is made for the service. Therefore option C is correct. Polluting fuel sales and weapons production are recorded market activities, while increased crime harms welfare rather than raising it.
Frequently asked questions
What is the correct answer to this question?
Free disaster relief by volunteers
Why is this the correct answer?
GDP mainly records market-valued final goods and services, so unpaid work can be omitted or understated. Free disaster relief provided by volunteers can greatly improve safety and welfare, but no market payment is made for the service. Therefore option C is correct. Polluting fuel sales and weapons production are recorded market activities, while increased crime harms welfare rather than raising it.
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.
