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Leading Economic Indicators
Variables that predict, or lead to, a recession or recovery; examples include consumer confidence, stock market prices, business investment, and big-ticket purchases, such as automobiles and homes.
Business Cycle
The natural fluctuation of the economy between periods of expansion (growth) and contraction (recession).
Price Level
The average of current prices across the entire spectrum of goods and services produced in the economy, often measured by a price index.
Risk-Free Rate
The rate of return on an investment with no risk of financial loss, typically represented by the yield on government bonds.
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