What does Gross Domestic Product (GDP) measure?

Gross Domestic Product (GDP) measures the total economic output of a country, which is the value of all goods and services produced within its borders over a specific time period, usually a year. It provides a comprehensive overview of a nation's economic performance and is a widely used indicator to assess the health of an economy. This total output includes everything produced in the economy, allowing economists and policymakers to gauge economic activity, growth trends, and the standard of living of the population over time.

The other options relate to different aspects of economic study but do not define GDP. For example, wealth distribution among citizens pertains to how income and wealth are divided among different groups, rather than measuring total output. The unemployment rate reflects the percentage of the labor force that is unemployed but does not assess overall economic productivity. Finally, the average living cost relates to the cost of goods and services required for a certain standard of living, which can be influenced by GDP but does not encapsulate what GDP measures itself. Thus, the answer accurately identifying GDP's function is the measurement of a country's total economic output.