NISM Certifications · NISM-Series-XV: Research Analyst · Economic Analysis
Which of the following best describes a coincident economic indicator?
A coincident indicator moves in line with the overall economy at the same time, for example industrial production. Leading indicators turn before the economy and lagging indicators turn after it, so they do not describe coincident behaviour.
- AIt moves in step with the overall economy, such as industrial productionCorrect
- BIt changes direction before the economy does
- CIt changes direction only after the economy has turned
- DIt is a forecast issued by the central bank
Explanation
Coincident indicators move together with the current state of the economy, for example industrial output or sales. Leading indicators turn first and lagging indicators turn afterwards, so those options describe different categories.
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