QuestionAugust 16, 2025

Which of the following indicators is a leading indicator? unemployment inflation business profits interest rates

Which of the following indicators is a leading indicator? unemployment inflation business profits interest rates
Which of the following indicators is a leading indicator?
unemployment
inflation
business profits
interest rates

Solution
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Answer

Business profits Explanation 1. Identify Leading Indicators Leading indicators predict future economic activity. They change before the economy starts to follow a particular pattern. 2. Analyze Each Option Unemployment, inflation, and interest rates are lagging indicators as they reflect past economic performance. Business profits can be considered a leading indicator because they often rise or fall in anticipation of economic changes.

Explanation

1. Identify Leading Indicators<br /> Leading indicators predict future economic activity. They change before the economy starts to follow a particular pattern.<br /><br />2. Analyze Each Option<br /> Unemployment, inflation, and interest rates are lagging indicators as they reflect past economic performance. Business profits can be considered a leading indicator because they often rise or fall in anticipation of economic changes.
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