GDP Is Not a Perfect Measure of Welfare Because It

question 70

Multiple Choice

GDP is not a perfect measure of welfare because it

• A)treats a dollar spent on guns the same as a dollar spent on education
• B)treats a dollar spent on exports the same as a dollar spent on imports
• C)double counts the value of leisure time
• D)double counts depreciation
• E)counts illegal activities in the underground economy

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Definitions:

Saving

The process of setting aside a portion of income for future use, instead of spending it immediately.

Population Growth Rate

The rate at which the number of individuals in a population increases over a specific period of time, often expressed as a percentage of the initial population.

Developing Versus Countries (DVCs)

Comparisons between countries in terms of economic development, often focusing on differences between developing countries and more industrialized nations.

Infrastructure

The fundamental physical and organizational structures and facilities (e.g., buildings, roads, power supplies) needed for the operation of a society or enterprise.