which of the following is considered to be a problem using GDP as a measure of n

Question

which of the following is considered to be a problem using GDP as a measure of national well-being? a) gdp does not include the value of leisure time b) gdp does not include the value of all goods and services produced in the underground economy. c) gdp does not include the value of household production d) items included in gdp are sold in markets which of the following is considered to be a problem using GDP as a measure of national well-being? a) gdp does not include the value of leisure time b) gdp does not include the value of all goods and services produced in the underground economy. c) gdp does not include the value of household production d) items included in gdp are sold in markets a) gdp does not include the value of leisure time b) gdp does not include the value of all goods and services produced in the underground economy. c) gdp does not include the value of household production d) items included in gdp are sold in markets

Explanation / Answer

The correct choice is option A

It is true that GDP does not include the contribution of household in the production process and that it fails to incorporate the underground economy, these are not the shortcomings of GDP. The major function of GDP as a measure of welfare is to determine how the society is better off with resource allocation and thus its ignorence toward leisure is a major problem.

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