Which of the Following Is Not a Commonly Cited Problem

question 16

Multiple Choice

Which of the following is not a commonly cited problem with the Index of Leading Economic Indicators?

• A) On several occasions the index has given false signals, predicting a recession when none occurred.
• B) By relying too heavily on financial variables, the index becomes overly sensitive to sudden changes in financial markets.
• C) The index provides little information on the severity of the upcoming recession.
• D) As the economy changes over time, the ability of macroeconomic variables to predict changes in the economy will improve for some, grow worse for others.

---

Definitions:

Statistical Artefact

An apparent result or trend in data that does not accurately reflect the true situation, often due to methodological errors or biases.

Heritability of IQ

The proportion of variation in intelligence within a population that can be attributed to genetic factors, often discussed in the context of nature versus nurture debates.

Arthur Jensen

An American psychologist known for his work in psychometrics and differential psychology, particularly his research on intelligence and race.

J.Philippe Rushton

A controversial psychologist known for his work on intelligence, race, and genetics.