Question
Gross domestic product is the way we measure the nations total income and output for a nation. This is to show a nations over all
Gross domestic product is the way we measure the nations total income and output for a nation. This is to show a nations over all growth and decline.
This gives a high level view of the nation's economy. There are several things not taken into account that can limit gross domestic product. It doesn't take int account the type of or quality of product being produced. People will tend to buy the cheapest product, not necessarily the best product. Cheap can sometimes mean repetitive buying of a product. This can result in an upward drive of the gross domestic product, as a result of the waste and inefficiency of the product.
Another limitations is a disaster isn't taken into account for the gross domestic product. It takes time and effort to rebuild after a disaster. This means that material will need to be bought driving up the economy. Time will be spent driving up the GDP.
When you don't take these things into account are you really giving a true and accurate measurement of a nations economy? chances are you, aren't, and have inflated numbers, which will affect the years to follow GDP.
Reference:
Cliff Notes(n.d.).https://www.cliffsnotes.com/cliffsnotes/subjects/economics/what-are-the-advantages-and-disadvantages-of-gross-domestic-product
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