Which Statement Is True About the Leading Economic Indicators

question 310

Multiple Choice

Which statement is true about the leading economic indicators?

• A)There are seven leading economic indicators.
• B)When the index of leading economic indicators changes direction,we are always approaching a business cycle turning point.
• C)The index of leading indicators generally turns down months before a recession begins.
• D)The leading economic indicators are of virtually no use in forecasting business cycle turning points.

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Definitions:

Cost Analysis

The process of assessing the costs involved in carrying out a particular business activity or project.

Variable Expenses

Costs that vary in direct proportion to changes in the level of activity or volume of production.

Fixed Expenses

Obligations that remain constant in total regardless of changes in business activity levels, such as lease payments and salaries.

Cost Formula Equation

An equation that determines the total cost based on fixed costs, variable rate per unit of activity, and the level of activity.