Question

    Country A, a developing economy, has experienced a

    significant increase in foreign direct investment (FDI) in recent years. This has led to the establishment of new industries, increased exports, and higher employment rates. However, there are concerns about the environmental impact of rapid industrialization and the potential for income inequality. Which of the following is the most comprehensive measure to assess the overall economic well-being of Country A, taking into account both the positive and negative effects of FDI?
    A Gross Domestic Product (GDP). Correct Answer Incorrect Answer
    B Gross National Income (GNI). Correct Answer Incorrect Answer
    C Green GDP. Correct Answer Incorrect Answer
    D Human Development Index (HDI). Correct Answer Incorrect Answer
    E Genuine Progress Indicator (GPI). Correct Answer Incorrect Answer

    Solution

    While GDP and GNI measure economic output, they do not account for environmental costs or income distribution. Green GDP attempts to incorporate environmental factors, but the GPI is the most comprehensive measure as it considers economic, social, and environmental factors, including income inequality and the depletion of natural resources.

    Practice Next
    More Banking System in India Questions
    ask-question