ECON 202 Lecture Notes - Lecture 8: Monopolistic Competition, John Maynard Keynes, Takers
7 Jul 2016
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Document Summary
Many economic activities move together over the business cycle. Procyclical: a variable moves up during expansions and down during contractions. Countercylcial: a variable moves down during expansions and up during contractions. Acyclical: a variable with ups and downs that do not coincide with those of the business cycle. Leading variable: reaches a peak or trough before the turning points of a business cycle. Lagging variable: reaches a peak or trough after the turning points of a business cycle. Coincident variable: reaches a peak or trough at the same time of a business cycle. The u. s. conference board combines 10 leading variables into an index of leading indicators that economists use to forecast changes in the economy. There are reasons to question the predictive power of the conference board"s monthly index of leading indicators in forecasting the business cycle: The conference board regularly revises the index when more accurate data become available.
