Economists often examine GNP to estimate changes in the well being of people.If one only studied GNP,which of the following would lead to one to overestimate the true increases in peoples' well being?

Question

Quizplus · Accepted Answer

GNP only measures market transactions and production, so a decrease in production in the home (i.e. more goods and services being purchased instead of produced at home) would lead to an overestimate of well being as it would be reflected in higher expenditures and thus higher GNP. Decreasing average hours of work, increasing life expectancy, decreasing levels of pollution, and increases in product quality would all lead to a more accurate estimation of well being as they directly improve people's quality of life.

Economists Often Examine GNP to Estimate Changes in the Well