When talking about business cycle, we identify leading indicators and lagging in

ID: 2428846 • Letter: W

Question

When talking about business cycle, we identify leading indicators and lagging indicators. Which of the following statements is incorrect?

Leading indicators refer to those variables that reach a peak and start to decline before the standard cycle peak.

A variable must be procyclical to qualifies as a leading indicator.

Profit is identified as leading indicator in our class, and it follows a procyclical pattern.

The unemployment rate is identified as lagging variable in our class, and it follows a countercyclical pattern.

Leading indicators refer to those variables that reach a peak and start to decline before the standard cycle peak.

A variable must be procyclical to qualifies as a leading indicator.

Profit is identified as leading indicator in our class, and it follows a procyclical pattern.

The unemployment rate is identified as lagging variable in our class, and it follows a countercyclical pattern.

Profit is identified as leading indicator in our class and it follows a procyclical pattern.

Profit is a lagging variable and it follows counter cyclical that is it decreases with expansion of economy.

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