Write down the limitations of using GDP as an index of welfare of a

1.	Write down the limitations of using GDP as an index of welfare of a country.
Answer» Following are the limitations of using GDP as an index of welfare of a country: 1. Distribution of GDP is not taken into account. 2. Composition of GDP is not accounted for. 3. Non monetary exchanges remain unrecorded, to which extent GDP remains underestimated. 4. Externalities are not considered, even when these have considerable impact on social welfare.

Write down the limitations of using GDP as an index of welfare of a country.

Answer»

Following are the limitations of using GDP as an index of welfare of a country:

1. Distribution of GDP is not taken into account.

2. Composition of GDP is not accounted for.

3. Non monetary exchanges remain unrecorded, to which extent GDP remains underestimated.

4. Externalities are not considered, even when these have considerable impact on social welfare.

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Write down the limitations of using GDP as an index of welfare of a country.

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