Day: October 12, 2025

The stock market is the place where shares of public companies are bought and sold. A company’s stocks can rise or fall in value, depending on how much demand there is for them and how profitable they are expected to be in the future. Investors hope to make money by buying stocks that are expected to rise in value, or selling their shares at a higher price than they bought them for. Typically, when you hear in the news that the “stock market is up” or down, it’s referring to a broad group of stocks such as the Dow Jones Industrial Average or the S&P 500. These are large groups of stocks that represent a wide range of industries and companies.

Stock prices are constantly rising and falling, based on supply and demand. Investors and traders are continually negotiating new prices with each other, changing them as they receive more or less information about a company. This process is called “price discovery.”

A company issues stock to raise money and allow investors a chance to gain profits from the growth of the business, as well as any dividends (a given amount of money per share at regular intervals) or appreciation in the price of the shares. A successful business is usually rewarded with rising stock prices, while a failing company may see its stock prices drop.

Individuals can purchase stocks by opening a brokerage account with a broker, or working with an investment advisor. These brokers will then buy and sell on your behalf on a trading exchange, such as the New York Stock Exchange or Nasdaq. These exchanges bring together people looking to buy a specific stock with those who are willing to sell it, and they facilitate the transactions at lightning speed.

GDP measures the monetary value of all the final goods and services produced within a country in a given period (usually a quarter or a year). The concept is similar to gross national product, but differs in that it includes some government expenditures that aren’t reflected in GNP, such as defense spending. GDP is usually calculated and reported quarterly by the Bureau of Economic Analysis (BEA). A country’s GDP tends to rise when output increases, but it can also increase if the price of goods and services increases or if production declines.

GDP is based on a variety of data sources, and thus can be subject to errors and biases. For example, it’s impossible to account for all consumption of goods and services, especially those that occur outside the market. The measurement also excludes all intermediate products used in the production of final goods; for example, steel sold to a car manufacturer is not included in GDP but flour sold to bakers would be.

Furthermore, GDP only accounts for activities that are provided through the market, ignoring non-market transactions, such as household production, bartering or volunteer or unpaid work. It also doesn’t take into account quality improvements or the introduction of new products, which may have a positive impact on an economy’s standard of living but are difficult to quantify. In order to combat some of these limitations, the United Nations has developed other metrics, such as the Human Development Index, which ranks countries not just by their GDP but by factors like life expectancy and literacy rate.