Question

Increase in absolute and per capita real GNP do not connote a higher level of economic development, if

(a) industrial output fails to keep pace with agricultural output

(b) agricultural output fails to keep pace with industrial output.

(c) poverty and unemployment increase.

(d) imports grow faster than exports.

Answer 1

Correct option is (c) poverty and unemployment increase.

Economic development includes not only economic growth but also various other economic changes that improve the quality of life or standard of living of people in a country. If with economic growth, a country experiences various economic changes such as reduction in poverty and unemployment, reduction in income and wealth inequality, increase in literacy rate, improvement in health and hygiene, etc, that improve the quality of life then that is economic development.