Which economic indicator is often used to measure overall economic health?

Gross Domestic Product (GDP) is a comprehensive measurement of a nation's overall economic activity. It reflects the total value of all goods and services produced over a specific time period within a country. A rising GDP indicates a growing economy, while a declining GDP suggests economic contraction.

GDP is considered a key indicator because it encapsulates various components such as consumer spending, business investment, government spending, and net exports (exports minus imports). By analyzing GDP growth rates, economists can assess how well the economy is performing and make comparisons between different economies.

While other indicators like the unemployment rate and the Consumer Price Index (CPI) provide valuable insights into specific aspects of economic health, they do not offer the same broad view of overall economic performance that GDP does. The unemployment rate focuses solely on joblessness, and the CPI primarily measures inflation and price changes. National debt levels indicate the financial obligations of a government but do not directly measure economic output or health. Thus, GDP remains the most widely recognized and utilized indicator for assessing the overall health of an economy.