Economic systems are complex. So you probably won’t be surprised to learn that no single measure captures all the dimensions of economic performance (Kelly & McGowen, 2012). Economic performance could be evaluated through several factors. The most common ones that are used are Gross Domestic Product (GDP), Employment level, and Consumer price index (CPI). These are all methods that can be used to help understand the health of today’s economic.
To get the full picture, Gross Domestic Product (GDP) is used to measure the total value of all final goods and services produced within a nation’s physical boundaries over a given period of time (Kelly & McGowen, 2012). Therefore, the higher the GDP means more output so it characterizes growth since more and more firms are being put up to produce or existing firms are being more productive. However, GDP levels tend to be somewhat understated, since they don’t include any illegal activities such as selling illegal drugs (Kelly & McGowen, 2012). According to the Bureau of Economic Analysis, “the output of goods and services produced by labor and property located in the United States increased at an annual rate of 0.4 percent in the fourth quarter of 2012” (“National Income and Product Accounts,”2012). The nation is showing some improvements base off of the annual rate of 0.4 percent.
Secondly, Employment Level is another measurement used to determine the health of the economic. The Bureau of Labor Statistics track employment levels through unemployment rate. So when less people are unemployed, it means that the workforce is being productive. Over the month, employment grew in professional and business services and in health care but deceased in retail trade (“The employment situation:” 2013). The nation current unemployment rate is at 7.6 percent through the month of March.
Finally, the government used the consumer price index to evaluate economic growth. Consumer price index (CPI) is the...