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Identify the correct statements about the externalities as a limitation of GDP and welfare.
A. GDP as measured does not include external production of goods.
B. Inverse relationship between negative externality and welfare.
C. No relation between GDP and welfare.
D. Economic activities have both positive and negative externalities.
E. Producers are rewarded with profit for positive externalities.
B. Inverse relationship between negative externality and welfare.
C. No relation between GDP and welfare.
D. Economic activities have both positive and negative externalities.
E. Producers are rewarded with profit for positive externalities.
Choose the correct answer from the options given below:
- a)A and D only
- b)B and E only
- c)D and E only
- d)B and D only
Correct answer is option 'D'. Can you explain this answer?
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Most Upvoted Answer
Identify the correct statements about the externalities as a limitatio...
Activities resulting in benefits to others are called positive externalities and increase welfare whereas those resulting in harm to others are called negative externalities and thus decrease welfare.
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Identify the correct statements about the externalities as a limitatio...
Positive and Negative Externalities in Economic Activities
One of the limitations of GDP and welfare is the presence of externalities in economic activities, which refer to the impact of an economic transaction on parties not directly involved in the transaction. Externalities can be positive or negative, affecting third parties either positively or negatively.
Economic Activities with Positive and Negative Externalities
- Economic activities have both positive and negative externalities. For example, the production of goods may result in pollution, which is a negative externality, impacting the environment and people's health.
- On the other hand, certain activities like education and healthcare can have positive externalities, benefiting society as a whole beyond the immediate participants.
Limitation of GDP and Welfare Measurement
- GDP as measured does not include external production of goods, meaning that the value of positive externalities is not accounted for in GDP calculations.
- The presence of negative externalities can lead to a decrease in overall welfare, as individuals or society as a whole may bear the costs of these external impacts.
Conclusion
In conclusion, the existence of externalities in economic activities, both positive and negative, poses a limitation to the accurate measurement of GDP and welfare. It is essential to consider the impact of externalities on overall welfare and societal well-being when evaluating economic performance and policies.
One of the limitations of GDP and welfare is the presence of externalities in economic activities, which refer to the impact of an economic transaction on parties not directly involved in the transaction. Externalities can be positive or negative, affecting third parties either positively or negatively.
Economic Activities with Positive and Negative Externalities
- Economic activities have both positive and negative externalities. For example, the production of goods may result in pollution, which is a negative externality, impacting the environment and people's health.
- On the other hand, certain activities like education and healthcare can have positive externalities, benefiting society as a whole beyond the immediate participants.
Limitation of GDP and Welfare Measurement
- GDP as measured does not include external production of goods, meaning that the value of positive externalities is not accounted for in GDP calculations.
- The presence of negative externalities can lead to a decrease in overall welfare, as individuals or society as a whole may bear the costs of these external impacts.
Conclusion
In conclusion, the existence of externalities in economic activities, both positive and negative, poses a limitation to the accurate measurement of GDP and welfare. It is essential to consider the impact of externalities on overall welfare and societal well-being when evaluating economic performance and policies.
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Identify the correct statements about the externalities as a limitation of GDP and welfare.A. GDP as measured does not include external production of goods.B. Inverse relationship between negative externality and welfare.C. No relation between GDP and welfare.D. Economic activities have both positive and negative externalities.E. Producers are rewarded with profit for positive externalities.Choose the correct answer from the options given below:a)A and D onlyb)B and E onlyc)D and E onlyd)B and D onlyCorrect answer is option 'D'. Can you explain this answer?
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Identify the correct statements about the externalities as a limitation of GDP and welfare.A. GDP as measured does not include external production of goods.B. Inverse relationship between negative externality and welfare.C. No relation between GDP and welfare.D. Economic activities have both positive and negative externalities.E. Producers are rewarded with profit for positive externalities.Choose the correct answer from the options given below:a)A and D onlyb)B and E onlyc)D and E onlyd)B and D onlyCorrect answer is option 'D'. Can you explain this answer? for Humanities/Arts 2024 is part of Humanities/Arts preparation. The Question and answers have been prepared according to the Humanities/Arts exam syllabus. Information about Identify the correct statements about the externalities as a limitation of GDP and welfare.A. GDP as measured does not include external production of goods.B. Inverse relationship between negative externality and welfare.C. No relation between GDP and welfare.D. Economic activities have both positive and negative externalities.E. Producers are rewarded with profit for positive externalities.Choose the correct answer from the options given below:a)A and D onlyb)B and E onlyc)D and E onlyd)B and D onlyCorrect answer is option 'D'. Can you explain this answer? covers all topics & solutions for Humanities/Arts 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Identify the correct statements about the externalities as a limitation of GDP and welfare.A. GDP as measured does not include external production of goods.B. Inverse relationship between negative externality and welfare.C. No relation between GDP and welfare.D. Economic activities have both positive and negative externalities.E. Producers are rewarded with profit for positive externalities.Choose the correct answer from the options given below:a)A and D onlyb)B and E onlyc)D and E onlyd)B and D onlyCorrect answer is option 'D'. Can you explain this answer?.
Identify the correct statements about the externalities as a limitation of GDP and welfare.A. GDP as measured does not include external production of goods.B. Inverse relationship between negative externality and welfare.C. No relation between GDP and welfare.D. Economic activities have both positive and negative externalities.E. Producers are rewarded with profit for positive externalities.Choose the correct answer from the options given below:a)A and D onlyb)B and E onlyc)D and E onlyd)B and D onlyCorrect answer is option 'D'. Can you explain this answer? for Humanities/Arts 2024 is part of Humanities/Arts preparation. The Question and answers have been prepared according to the Humanities/Arts exam syllabus. Information about Identify the correct statements about the externalities as a limitation of GDP and welfare.A. GDP as measured does not include external production of goods.B. Inverse relationship between negative externality and welfare.C. No relation between GDP and welfare.D. Economic activities have both positive and negative externalities.E. Producers are rewarded with profit for positive externalities.Choose the correct answer from the options given below:a)A and D onlyb)B and E onlyc)D and E onlyd)B and D onlyCorrect answer is option 'D'. Can you explain this answer? covers all topics & solutions for Humanities/Arts 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Identify the correct statements about the externalities as a limitation of GDP and welfare.A. GDP as measured does not include external production of goods.B. Inverse relationship between negative externality and welfare.C. No relation between GDP and welfare.D. Economic activities have both positive and negative externalities.E. Producers are rewarded with profit for positive externalities.Choose the correct answer from the options given below:a)A and D onlyb)B and E onlyc)D and E onlyd)B and D onlyCorrect answer is option 'D'. Can you explain this answer?.
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