Question

Why is the stock exchange called a barometer of the economic and business conditions in a country

Answer 1

It is quite common for a stock index or exchange to be used as a barometer for the national economy. The stock exchange is not only used as a platform to carry business transactions but as the barometers that help in indicating the general conditions of the business atmosphere.

Answer 2

Apart from acting as a platform to carry business transaction stock exchanges also acts as the barometer for the national economy which indicates the economic and business conditions in a country. Since stock exchange provides the real and accurate information about the companies it is easy to measure the economic and business conditions with the help of it.