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But by that logic, it makes no sense to compare the cost of a new computer to the cost of rent, because they're different things. GDP is a measure in units of m
by Shikadi 9y ago
But by that logic, it makes no sense to compare the cost of a new computer to the cost of rent, because they're different things. GDP is a measure in units of money, and so is stock value, so you can compare them just fine even though they're not related to each other.
- jdmichal 9y agoThat doesn't follow at all... A cost is always an outflow of money. As I mentioned in another thread, GDP counts the "same dollar" being spent multiple times. Even if there was only one dollar in the economy, you could generate millions in GDP by spending that one dollar millions of times in a year. However, you sure as hell aren't going to be making a $10 acquisition proposal with only $1 in the economy.
- Shikadi 9y agoYou're missing the point here, no one is comparing the two as if a country's GDP represents something equivalent to the value of a company. They're just saying something along the lines of "Wow! 3,000,000 gallons of water?!? That's more than the amount of water that flows past my house on the river in a year!" (Obviously made up numbers)