The variables in the index of leading indicators are included in the index because
A) they turn down prior to a deflation and turn up prior to an inflation.
B) they generally lag behind turns in the business cycle.
C) they turn down prior to a recession and turn up before the beginning of a business expansion.
D) they provide a comprehensive measure of the current state of the economy.

Question

Quizplus · Accepted Answer

The variables included in the index of leading indicators turn down prior to a recession and turn up before the beginning of a business expansion, making them useful in predicting changes in the business cycle.

The Variables in the Index of Leading Indicators Are Included