ECONOMICS
BUSINESS CYCLES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Personal income
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The ratio of how much consumers owe to measures of personal income
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Stock prices
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None of the above
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Detailed explanation-1: -The Consumer Price Index (CPI), which measures changes in the inflation rate, is another closely watched lagging indicator.
Detailed explanation-2: -Economic Lagging Indicators Some general examples of lagging indicators include the unemployment rate, corporate profits, and labor cost per unit of output. Interest rates can also be good lagging indicators since rates change as a reaction to severe movements in the market.
Detailed explanation-3: -Lagging Economic indicators include unemployment rates, manufacturing capacity utilization, inflation rate (CPI), average earnings and short-term interest rates.
Detailed explanation-4: -While we don’t ever really know if we’re nearing a recession until we’re already in one, data measured through its duration can prove that the economy entered a state of contraction. Therefore, recessions can be considered lagging indicators.
Detailed explanation-5: -GDP: Gross Domestic Product (GDP) growth, used as a measure of economic health, is actually a lagging indicator of the economy, as the measure is always slightly behind the reality. While GDP growth provides valuable information about the economy, the measure doesn’t point to the future but to the past.