Index (economics)

Index (economics) is like keeping score in a game. An index is a measurement of how well certain things in the economy are doing. For example, the U.S. stock market has something called the Dow Jones Industrial Average, which tracks the prices of 30 big companies. If those companies are doing well, the index will go up. If they are doing badly, the index will go down. Economists rely on indexes to get a good idea of how the whole economy is doing.