Which economic indicator measures overall economic performance and growth?

Gross Domestic Product (GDP) is a crucial economic indicator that measures the total value of all goods and services produced within a country's borders over a specific time period. It reflects the economic performance and growth of a nation by indicating how much economic activity is occurring. When GDP increases, it suggests that the economy is growing and producing more goods and services, which often correlates with higher employment levels and improved standards of living. Conversely, if GDP decreases, it may signify economic contraction, which could lead to rising unemployment and other economic challenges.

The other indicators mentioned, while important in their own right, serve different purposes. The unemployment rate helps assess labor market conditions, the Consumer Price Index (CPI) measures inflation and changes in purchasing power over time, and the trade balance indicates the difference between exports and imports. While these metrics are valuable for understanding specific aspects of the economy, they do not provide a comprehensive overview of overall economic performance and growth like GDP does.