Critically assess GDP (or GDP/capita) as a measure of: (i) output, (ii) social welfare.
Provide at least three arguments for each.
The per capita GDP reflects the economic output of the total population. It is determined by dividing the GDP (Gross Domestic Product) by the NP (Number of the population) helps in identifying the living standard of people of the country.
Answer and Explanation:
The Gross domestic product refers to the number of goods and services produced in a year within the boundary of the nation. In the case of output, GDP increase as output increases and lower as output decreases. Therefore, GDP directly affects the output. It increases the per capita GDP by increasing the income of the people.
Whereas, GDP doesn't affect social welfare doesn't deal with the standard of living. The GDP per capita reflects social welfare through the income of the people according to their expenditure and earning.
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from Economics 102: MacroeconomicsChapter 4 / Lesson 3