Why is national income considered an incomplete indicator of economic health in macroeconomics?
Answer and explanation
Correct answer: Because it does not fully show distribution, employment, prices and quality of life
National income measures the monetary value of economic activity, but it does not by itself reveal how income is distributed, whether jobs are adequate, whether prices are stable, or whether production improves health, security and environmental quality. A complete assessment therefore requires several complementary social and economic indicators.
Frequently asked questions
What is the correct answer to this question?
Because it does not fully show distribution, employment, prices and quality of life
Why is this the correct answer?
National income measures the monetary value of economic activity, but it does not by itself reveal how income is distributed, whether jobs are adequate, whether prices are stable, or whether production improves health, security and environmental quality. A complete assessment therefore requires several complementary social and economic indicators.
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.
