The GPA system provides a standardized measure of academic performance, motivating students to excel and setting goals for achievement. It fosters competitiveness, accountability, and self-evaluation while serving as a quality assurance tool for educational institutions. GPA influences eligibility for scholarships, awards, and admission to higher education, creating a psychologically impactful environment. It incentivizes learning by rewarding mastery and guides students in identifying areas for improvement. Despite its benefits, it's crucial to ensure fair and supportive implementation to promote student success and well-being.