Reference Point

A reference point is a standard or baseline you use to compare and judge changes or differences in a situation. For example, if you look at your weight before and after a workout, your original weight serves as a reference point. It helps you evaluate whether you've gained, lost, or stayed the same. Reference points are essential in many contexts—like assessing economic performance, personal progress, or decision-making—because they provide a familiar standard against which to measure and interpret new information, making it easier to understand changes and make informed choices.