GDP data are criticized as being inaccurate measures of economic welfare because:
A) they do not take into account changes in the amount of leisure.
B) they do not take into account changes in product quality.
C) they do not take into account the adverse effects of economic activity on the environment.
D) of all of the above considerations.

Question

Quizplus · Accepted Answer

All three statements are true criticisms of GDP data. GDP only accounts for market transactions, so it does not capture the value of leisure time or the value of non-market activities like parenting or volunteer work. GDP also does not consider changes in product quality, so it does not reflect improvements in technology or the introduction of new and better products. Finally, GDP does not account for the environmental costs of economic activity, such as pollution or resource depletion. These are all important factors in measuring economic welfare, so GDP data should be interpreted with caution.

GDP Data Are Criticized as Being Inaccurate Measures of Economic