Economics · Gross Domestic Product (GDP)

Consider the following statements about GDP as a measure of economic welfare and progress: A. GDP does not account for income inequality in its distribution. B. GDP excludes non-market activities such as household work and voluntary services. C. GDP includes negative externalities (e.g., pollution costs) as positive contributions when they generate spending on clean-up. D. GDP includes depreciation of natural capital (resource depletion). E. A rise in real GDP per capita always implies an improvement in human development and well-being. Which of the above statements are correct criticisms of GDP as a welfare measure?