How does the average amount of nonmarket production affect living standards?
A) It results in goods and services for consumption that are not included in GDP. Living standards are higher than what is represented by GDP per capita.
B) It results in goods and services for consumption that increase GDP. GDP is higher than it would be without the nonmarket production.
C) It raises the prices of goods and services due to increased demand for them. This means that GDP and living standards appear higher even though the quantity of production is unchanged.
D) It has no impact on living standards because it is outside of the markets that determine how much people have to consume.

Question

Quizplus · Accepted Answer

Nonmarket production includes goods and services that are produced but not sold in the market, such as household chores and caregiving. These contribute to living standards by providing consumption value not captured in GDP, making actual living standards higher than what GDP per capita alone would suggest.

How Does the Average Amount of Nonmarket Production Affect Living