Variables that change before real GDP changes are measured by the:
A) personal income index.
B) real GDP index.
C) forecasting gauge.
D) index of leading indicators.

Question

Quizplus · Accepted Answer

The index of leading indicators tracks variables that tend to change before real GDP changes, such as stock prices, consumer confidence, and average weekly hours worked. This index is used as a forecasting tool for the direction of the economy. The other options, personal income index and real GDP index, are measures of actual economic activity that do not necessarily predict future changes. The term "forecasting gauge" is not a recognized economic term or indicator.

Variables That Change Before Real GDP Changes Are Measured by The