What are the limitations to GDP?
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Limitations To GDP are-
1.Changes in quality and the inclusion of new goods
2.Leisure/human costs
3.Underground economy
4.Harmful Side Effects
5.Non-Market Production
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Answer: Distribution of GDP- It is possible that with rise in GDP inequalities in the Distribution of income may also increase the gap between rich and poor increases GDP does not take into account changes in inequalities in the Distribution of income.
Change in price- If increase in GDP is due to rise in prices and not due to rise in physical output than it will be a reliable index of economic welfare.
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