merits: measures the retail value of things actually produced in a country in a given year which is indicative of the standard of living and quality of life in that country because that production translates into jobs and goods available to be purchased with the wages earned
demerits: buying used stuff improves people's standard of living but does not add to GDP, same goes for the black market. the biggest problems with using GDP as a measure of a country's standard of living are 1) lower quality goods are better for GDP because they have to be replaced more often and 2) crime is good for GDP because it increases demand for a variety of goods such as guns, surveillance equipment, security services, etc.
