Reference: Ref 6-5 (Table: Celebrity Income) Refer to the table. GDP is seen as an imperfect measure of economic activity for several reasons. Which of the four reasons below is illustrated through the data in the table?
A) GDP does not count nonmarket production.
B) GDP does not make a positive adjustment for leisure.
C) GDP does not account for environmental costs.
D) GDP does not measure the distribution of income.

Question

Reference: Ref 6-5 (Table: Celebrity Income) Refer to the table. GDP is seen as an imperfect measure of economic activity for several reasons. Which of the four reasons below is illustrated through the data in the table?
A) GDP does not count nonmarket production. 
B) GDP does not make a positive adjustment for leisure. 
C) GDP does not account for environmental costs. 
D) GDP does not measure the distribution of income.

Quizplus · Accepted Answer

The table shows the income of celebrities, which can be very high compared to the average income of the population. This indicates that GDP does not measure the distribution of income accurately, as it does not take into account the disparities between the incomes of different groups in society.

Reference: Ref 6-5 (Table: Celebrity Income) Refer to the Table