Gross Domestic product (GDP) is the total value of all the final goods and services produced by an economy within the domestic territory of a country in a particular year. It is one of the best indicators of the economic performance of a country but not of economic welfare or economic development because while calculating GDP, the non-monetary transactions are ignored.
Non-monetary exchanges include activities like services of family members provided to each other etc. For example, service of a housewife while teaching her children or while cooking food in kitchen. These activities are not included in GDP but they contribute to welfare of the people.
Thus, GDP indicates the economic growth but not the economic welfare.
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