Diebold and Rudebusch Showed That the Composite Index of Leading

question 42

Multiple Choice

Diebold and Rudebusch showed that the composite index of leading indicators did not improve forecasts of industrial production because

• A)the index is not produced in a timely manner.
• B)the government manipulates the index so it never predicts a recession.
• C)the index is not designed for forecasting.
• D)data on the components of the index are revised.

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Definitions:

Aggressive Impulses

Instinctive drives that prompt individuals to act or respond with hostility or violence.

Frustrated

Experiencing irritation or disappointment stemming from the incapacity to effect change or reach a goal.

Defence Mechanisms

Unconscious psychological strategies used to cope with reality and to maintain self-image by reducing anxiety arising from unacceptable or potentially harmful stimuli.

Anxiety

A feeling of worry, nervousness, or unease about something with an uncertain outcome, often reflecting a reaction to stress.