SIE Knowledge of Capital Markets Question 9: Answer and Explanation

Question: 9

Level of new business start-ups is an example of which of the following?

• A. Leading economic indicator
• B. Lagging economic indicator
• C. Coincident economic indicator
• D. Seasonal economic indicator

Correct Answer: A

Explanation:

A: The level of new business start-ups is an example of a leading economic indicator. New business start-ups generally are followed by additional jobs, new products, and new services. The level of new business start-ups is not a lagging or coincident economic indicator, Choices B and C. Choice D, seasonal economic indicator, is not a relevant term.