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      Question

      When converting India's traditional Nominal Gross

      Domestic Product (GDP) into "Green GDP" to account for environmental degradation, which of the following accounting adjustments must be made?
      A Add the total expenditure on defensive environmental technologies to Nominal GDP. Correct Answer Incorrect Answer
      B Subtract the monetary value of natural resource depletion and environmental degradation from Net Domestic Product (NDP). Correct Answer Incorrect Answer
      C Multiply standard GDP by the national carbon credit index. Correct Answer Incorrect Answer
      D Subtract the total tax revenue collected via petroleum cesses. Correct Answer Incorrect Answer

      Solution

      Green GDP is an index of economic growth that factors in environmental consequences. Structurally, Green GDP = NDP - (Cost of Natural Resource Depletion + Cost of Environmental Degradation). It adjusts net domestic production downwards to reflect the true, sustainable economic value generated by the nation.

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