Consider a nation that uses natural resources in the construction of final goods and services. For example,
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Consider a nation that uses natural resources in the construction of final goods and services. For example, they cut down all their trees to make paper products. In this nation, the value of GDP is increasing, but the well-being of the nation is actually falling. Some economists suggest that GDP should take the use of these national resources into account by lowering the stated value. In addition, if a nation increases pollution to produce final goods and services, GDP can increase although the well-being of the nation is falling. Why might it be difficult to measure natural resource depletion or pollution and convert the resulting quantity into a dollar-denominated amount?
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