IIFT 2018 Question Paper | VARC

The best way to boost your IIFT prep is to practice the actual IIFT Question Papers. 2IIM offers you exactly that, in a student friendly format to take value from this. In the 2018 IIFT, varc was a mixed bag of questions of varying difficulty, with some routine questions and the others were very demanding. Some beautiful questions that laid emphasis on Learning ideas from basics and being able to comprehend more than remembering gazillion formulae and shortcuts.

For policy makers to this day. GDP remains the definitive yardstick for economic performance, permitting them to assess the health and progress of a nation's economy and, by extension, people's lives. Yet GDP's dominance has brought criticism. It fails to capture changes to an economy's structure, such as the shifts to a service-led or technology-based economy. Some have protested that it fails to capture the unofficial or black market economy. Others have asserted that any purely economic indicator by itself may be inadequate to truly measure society's progress. It is therefore no surprise that over the last several decades, economists, Sociologists, and other academics have devised other metrics for tracking happiness, well-being, and social progress, some of which have garnered a substantial following. Implicit in these metrics is a challenge to GDP as the dominant measure of human progress-despite the fact that these measures sometimes themselves rely on GDP or some variance of GDP and come with limitations of their own. Even so, GDP remains a compelling measure of economic as well as social progress inasmuch as improvements in economic GDP translate into social progress. Policymakers have nevertheless become interested in these alternative measures, which, even if they do not displace GDP as the most prominent measure of economic growth, have value in complementing GDP in future assessments for economic and living standard progress. Furthermore, these proposed additions to GDP remind us that the endgame for public policy is progress and improved living standards rather than GDP growth for growth's sake. Nonetheless. These rankings reveal that consistently richer Countries (in terms of GDP) rank at the top of the indices and poorer ones at the bottom. For example, happiness indices reflect a
demand that happiness be recognized as a criterion for government policy. First published in 2012, the World Happiness Report measures happiness by indexing GDP per capita alongside social support, life expectancy, freedom, generosity, and the absence of corruption. Of the 155 Countries collated in the 2017 World floppiness Report, the ten happiest countries, in descending order, are Norway. Denmark, Iceland, Switzerland. Finland, the Netherlands, Canada, New Zealand, Australia, and Sweden. The ten least happy countries, beginning with the least happy, are the Central African Republic, Burundi, Tanzania, Syria, Rwanda, Togo, Guinea, Liberia, South Sudan, and Yemen: While the United States is the largest country in GDP terms, it ranks fourteenth on the 2017 happiness index. A more traditional measure that goes beyond GDP alone is the United Nations' Human Development Index (HIM). First published in 1990, the HDI assesses longevity, education, and income across each nation's population, on the premise "that people and their capabilities should be the ultimate criteria for assessing the development of a country, not economic growth alone." The HDI reveals how two countries with the same level of gross national income (GNI)-that is, the total domestic output (GDP) plus foreign GDP generated by citizens abroad, minus domestic output created by foreigners-can end up with such different outcomes. In this way, it allows observers to compare the relative effectiveness of different policy choices and capital investments. In this index, Norway, Australia. and Switzerland ranks at the top, with GNIs above USS40,000, and the Central African Republic, Niger, and Chad at the bottom of the index, all with GNIs of less than US$2,000 per capita. Some of these measures move beyond individuals and attempt a
holistic assessment of the health of society. Since its founding in 2012, the Social Progress Imperative has offered a Social Progress Index that examines a range of social and environmental indicators beyond GDP, from access to electricity to religious tolerance; to
measure three distinct dimensions of social progress: Basic Human Needs, Foundations of Wellbeing, and Opportunity. The 2017 Social Progress Index covers 133 countries and 94 percent of the world's population. The world as a whole would score 64.85 in Social
Progress based on an average of all countries. On average, the top cluster of fourteen countries ranked as having "very high social progress"-including Denmark, Finland, Iceland, Norway, and Switzerland among others-scores 94.92 on Basic Human Needs, Foundations of Wellbeing, and Opportunity. The cluster of seven countries described as having' very low social progress" include the Central African Republic, Afghanistan. Chad, Angola, Niger, Guinea, and Yemen. For this cluster the average dimension scores of Basic Human Needs, Foundations of Wellbeing, and Opportunity are 42.67, 45.42, and 27.74. What can we learn from these various indices? While noneconomic factors such as health, well-being, and quality of life matter to humanity, economic measures such as GDP generally correlate to success in the other areas, with a small amount of variation among those who are awarded the top spot. In a nutshell, economic growth underpins all else; a country needs economic growth to achieve happiness, well-being, and ultimately human progress. To be sure, GDP estimates provide a snapshot of GDP at a single point in time, but nothing more. A large GDP can indicate that a country is rich yet mask that its economy might be struggling and scarcely growing.

Question 14 : What is the author's opinion regarding GDP as a measure for economic performance of a country?

1. GDP is the yardstick for measuring economic growth of a country
2. GDP provides policy makers with definitive steps to be taken for improving economic performance
3. GDP provides accurate but incomplete information of an economy at a single point of time
4. GDP is the only reliable measure that can be used for framing economic policy

Explanatory Answer

Note the last few lines of the passage: "While noneconomic factors such as health, well-being, and quality of life matter to humanity, economic measures such as GDP generally correlate to success in the other areas..." and "To be sure, GDP estimates provide a snapshot of GDP at a single point in time, but nothing more...".

The question is " What is the author's opinion regarding GDP as a measure for economic performance of a country? "

Hence, the answer is 'GDP provides accurate but incomplete information of an economy at a single point of time'

Choice C is the correct answer.

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