Why do economist s include only final goods and services in measuring the GDP for a particular year?? Why don’?
Why do economist s include only final goods and services in measuring the GDP for a particular year?? Why don’t they include the value of stocks and bonds bought or sold?? Why don’t they include the value of used furniture bought and sold.
Please help. thanks in advance
- Anonymous8 years agoFavorite Answer
Because they DON'T want to count a particular product TWICE. Imagine if you bought a sack of uncooked rice for $10, and after cooking it you sold it for $15; would you want to say you have a 25 dollars worth of rice (10+15=25)!! you probably dont want to.
Just state the $15 worth of final good (that is the cooked rice).
- contoisLv 44 years ago
The dollar value of very final products includes the dollar value of intermediate products. If intermediate products have been counted, then distinctive counting would happen. the value of steel (an intermediate stable) used in vehicles is blanketed in the value of the automobile (an particularly final product). This value isn't blanketed in GDP by way of fact such sales and purchases basically circulate the possession of cutting-edge ingredients; such sales and purchases are no longer themselves (financial) investment and consequently should not depend as production of very final products and centers. Used furnishings became produced in some previous 12 months; it became counted as GDP then. Its resale would not degree new production.