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JAMB Economics 2001 Question 47

Question 47

National Income

GNP is not a good measure of social welfare because there are unrecorded

  1. A.indirect taxes
  2. B.social costs
  3. C.government subsidies
  4. D.transfer payments
Show the answer and explanation

Answer: B (social costs)

Explanation

GNP does not deduct social costs such as pollution and congestion, which reduce welfare but are not recorded.