Question

If the effects of pollution on society as a measure of welfare were included in GDP calculations, that measure level of GDP would most likely Group of answer choices become negative. decrease. increase. not change. PreviousNext Quiz

Answer 1

Answer:

not change.

Explanation:

Gross domestic product is the total sum of final goods and services produced in an economy within a given period which is usually a year

GDP calculated using the expenditure approach = Consumption spending by households + Investment spending by businesses + Government spending + Net export

Net export = exports – imports

When exports exceeds import there is a trade deficit and when import exceeds import, there is a trade surplus.  

Items not included in the calculation off GDP includes:  

1. services not rendered to oneself

2. Activities not reported to the government  

3. illegal activities

4. sale or purchase of used products

5. sale or purchase of intermediate products

6. Measure of welfare e.g. effects of pollution