Identify a limitation of using gross domestic product (GDP) as a measure for development.(1 point)
Responses
It overemphasizes health indictors such as life expectancy.
It overemphasizes health indictors such as life expectancy.
It doesn’t account for the value of services in the economy.
It doesn’t account for the value of services in the economy.
It overemphasizes environmental sustainability.
It overemphasizes environmental sustainability.
It doesn’t account for income distribution.
It doesn’t account for income distribution.
Correct, one limitation of using gross domestic product (GDP) as a measure for development is that it doesn't account for income distribution.
The correct response is: It doesn't account for income distribution.
Explanation: GDP measures the total value of goods and services produced within a country in a specific period. However, it doesn't provide information about how that income is distributed among the population. In other words, GDP does not capture income inequality or poverty levels within a country. It is possible for a country to have a high GDP but still have a significant portion of its population living in poverty or experiencing income disparities. To account for income distribution, additional measures such as Gini coefficient or the poverty rate need to be considered alongside GDP.