Final answer:
The Gross Domestic Product (GDP) measures the overall value of goods and services within a country. The CPI reflects household spending and is considered a cost-of-living index, while the PPI tracks producer prices and the GDP deflator accounts for all goods and services in the economy.
Step-by-step explanation:
The economic indicator that measures the overall value of goods and services is the Gross Domestic Product (GDP). The GDP represents the total value of all goods and services produced over a specific time period within a country's borders. The Bureau of Labor Statistics (BLS) takes several measures to avoid biases in the Consumer Price Index (CPI), for example, by updating the basket of goods and services and using geometric mean formulation to better capture consumer behavior in the face of price changes.
It's important to differentiate among various indices, such as the CPI, PPI (Producer Price Index), International Price Index, Employment Cost Index, and GDP deflator. The CPI, known as the cost-of-living index, reflects prices of goods and services purchased by households. In contrast, the PPI measures the prices paid by producers for supplies and inputs, and the GDP deflator includes the prices of all goods and services in GDP, adjusted for inflation.