Pollution is a by-product of some production processes, so on this count real GDP as measured
A) is adjusted downward to take into account the pollution.
B) is adjusted upward to take into account the expenditures that will be made in the future to clean up the pollution.
C) tends to overstate economic welfare.
D) tends to understate economic welfare.

Question

Quizplus · Accepted Answer

Real GDP does not adjust for the negative externalities like pollution, which can lead to an overstatement of economic welfare since it does not account for the environmental degradation and its impact on well-being.

Pollution Is a By-Product of Some Production Processes, So on This