SIE practice questionmediumLagging Indicators
Which of the following is a LAGGING economic indicator?
- AAverage prime rate charged by banks✓ Correct answer
- BInitial claims for unemployment insurance
- CBuilding permits
- DS&P 500 stock index
Explanation
Why A — Average prime rate charged by banks
The average prime rate is a lagging indicator because banks adjust it after broader economic conditions have changed. Initial unemployment claims, building permits, and stock indexes are leading indicators that tend to move before the overall economy.
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