Using GDP as a Measure of the Economic Well-Being of a Country

question 81

Multiple Choice

Using GDP as a measure of the economic well-being of a country can be criticized for ignoring non-market and other activities.However,it remains useful because

• A)GDP is the best measure we have of the effects of economic "bads" on the well-being of the country.
• B)the change in GDP from one year to the next is a good indication of what rates of inflation and unemployment will be.
• C)it provides a good indication of household income distribution when measured from the income side.
• D)the change that is measured in GDP from one year to the next is a good indication of the change in economic activity.
• E)it is simply not possible to reform the current measure of GDP.

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Definitions:

Corporation

A legal entity that is separate from its owners, offering limited liability to its shareholders, and able to own property, enter contracts, and sue or be sued.

Partnership

A legal arrangement where two or more individuals share ownership of a business, including its liabilities and profits.

Cooperative

An association, which may or may not be incorporated, that is organized to provide an economic service to its members. Unincorporated cooperatives are often treated like partnerships for tax and other legal purposes.

Joint Venturer

An individual or entity that collaborates with another party in a joint venture, sharing in the risks and rewards of the business endeavor.