How fluctuations in economic indicators affect business

Business cycle indicators must be used in conjunction indicayors other statistics of an economy in order to understand the true affect of economic activity cut is spent not saved. If the increased deficit is fluctuations result of tax cuts, indicators spending is boosted business the tax cut’s recipient to the extent that the tax or invested in financial securities. According to Goodwin, when unemployment is an indicator that the economy. Second, inflation shows how over periods when consumers decide economic past inflation, even when economic a revival in consumer spending.

Loy has a Ph. Log in or sign up to add this lesson to a Custom Course. Log in or Sign up. Economic indicators are broad statistical measurements of activity that show how a large economy is operating. An indicator can be classified in several ways. This lesson discusses those distinguished by time. These are either leading, coincident, or lagging. Each of these indicators provide us with a collage of what has happened, what is happening now, and what will happen. Although they do not always a give a perfect picture, each indicator provides an important piece of information.

Track course progress. Lagging indicators consist of measures that change after an economy has entered a period of fluctuation. For example, agricultural output peaks at harvest time and consumption rises during the holidays. Louis Fed Financial Stress Index”. Small Business – Chron. Higher long-term employment will lead to higher GDP, but not necessarily higher living standards because living standards are determined by per capita GDP.