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.

Question

Quizplus · Accepted Answer

Diebold and Rudebusch found that data on the components of the composite index of leading indicators are often revised, rendering the index less reliable for forecasting purposes.

Diebold and Rudebusch Showed That the Composite Index of Leading