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प्रश्न
"Gross Domestig Product (GDP) as an indicator of welfare loses its significance if the distribution of income turns unequal." Justify the given statement with valid reason.
उत्तर
Yes, this is absolutely correct. A rise in GDP alone may not result in an increase in economic welfare. It is only significant when the distribution is equal. If it is not distributed equally, it will make the rich richer and the poor poorer. As a result, this indicator does not apply when the distribution is unequal.
संबंधित प्रश्न
Giving reason explain how should the following be treated in estimating gross domestic product at market price?
Fees to a mechanic paid by a firm.
How will you treat the following while estimating domestic product of a country? Give reasons for your answer:
Gifts are given by an employer to his employees on Independence Day
How will you treat the following while estimating domestic product of a country? Give reasons for your answer:
Purchase of goods by foreign tourists
Calculate (a) national income (b) net national income disposable income:
| (Rs. in crores) | ||
| 1 | Net factor income to abroad | (-) 50 |
| 2 | Net indirect taxes | 800 |
| 3 | Net current transfers from rest of the word | 100 |
| 4 | Net imports | 200 |
| 5 | Private final consumption expenditure | 5000 |
| 6 | Government final consumption expenditure | 3000 |
| 7 | Gross domestic capital formation | 1000 |
| 8 | Consumption of fixed capital | 150 |
| 9 | Change in stock | (-) 50 |
| 10 | Mixed income | 4000 |
| 11 | Scholarship to students | 80 |
Calculate the (a) Gross National Product at market price, and (b) Net National Disposable Income
| (Rs In crores) | |
| (i) Compensation of employee | 2,500 |
| (ii) Profit | 700 |
| (iii) Mixed income of self- employed | 7,500 |
| (iv) Government final consumption expenditure | 3,00 |
| (v) Rent | 400 |
| (vi) Interest | 350 |
| (vii) Net factor income from abroad | 50 |
| (viii) Net current transfer to abroad | 100 |
| (ix) Net indirect taxes | 150 |
| (x) Depreciation | 70 |
| (xi) Net export | 40 |
If the Real Gross Domestic Product is Rs 250 and the Price Index (base = 100) is 120, calculate the Nominal Gross Domestic Product.
Giving reason explain how should the following be treated in estimating gross domestic product at market price?
Interest paid by an individual on a car loan taken from a bank.
Explain how ‘distribution of gross domestic product’ is a limitation in taking gross domestic product as an index of welfare.
NDPFC = ____________.
NDPFC =?
Which of the following statements are correct
Statement 1: The wealth of a country can be increased with the efforts of a healthy workforce.
Statement 2: Investment in the health sector increases the efficiency and productivity of a nation's workforce.
Statement 3: In contrast to an unhealthy person, a healthy person can work better with more efficiency and consequently, can contribute relatively more to the GDP of the country
Profits earned by a branch of a foreign bank in India are ______ in the domestic product of India.
Assertion (A): GDP is the correct measure of the improvement of welfare of the people.
Reason (R): Many activities in an economy are not evaluated in monetary terms, they are not included in GDP due to non-availability of data.
What does the Factor Cost represent?
Which of the following statements is false?
On the basis of the data given below for an imaginary economy, estimate the value of Net Domestic Product at factor cost (NDPFC):
| S.No. | Items | Amount (₹ in crore) |
| (i) | Household Consumption Expenditure | 2,000 |
| (ii) | Government Final Consumption Expenditure | 1,500 |
| (iii) | Gross Domestic Fixed Capital Formation | 1,000 |
| (iv) | Net additions to stock | 300 |
| (v) | Exports | 700 |
| (vi) | Net Indirect Taxes | 350 |
| (vii) | Imports | 200 |
| (viii) | Consumption of Fixed Capital | 250 |
For a closed economy (with no foreign trade), which one of the following is correct?
Union Finance Minister Mrs. Nirmala Sitharaman announced during her Budget speech that the Centre would reduce its fiscal deficit to 5.1% of gross GDP in 2024 – 25. (The present fiscal deficit is 5.8% of GDP.)
(Source: Union budget 2024 – 25)
What would be the impact of this decision on government borrowing? Why?
