Title: QUIZ: Leading Indicators -- Jargon Alert
Course: Andria Testing FRE2 > Section: Leading Indicators -- Jargon Alert

Q: What are leading economic indicators?
- Data that react before the overall economy moves in a new direction
- Data that measure the current state of the overall economy
- Data that are released before the end of the month to show economic trends
- Data that are compiled and analyzed by the Conference Board to track economic performance
A: Data that react before the overall economy moves in a new direction

Q: Why are new building permits considered a leading economic indicator?
- New building permits measure current home sales activity.
- They are released by the Department of Labor who tracts construction who know the future state of the economy.
- Builders are unlikely to obtain permits unless they are confident about future economic prospects.
- New building permits are not a leading economic indicator about the economy.
A: Builders are unlikely to obtain permits unless they are confident about future economic prospects.

Q: What is the purpose of the Conference Board's Index of Leading Economic Indicators (LEI)?
- To provide new information to financial markets about future economic trends
- To compile data series that have a strong relationship with the business cycle
- To predict the exact timing of the next economic recession with high accuracy
- To measure the current state of the overall economy using key economic indicators
A: To compile data series that have a strong relationship with the business cycle

Q: Which of the following is NOT included in the LEI?
- The federal funds rate
- The stock market
- Initial claims for unemployment insurance
- The slope of the yield curve
A: The federal funds rate

Q: According to the article, how does the LEI typically perform in relation to downturns and recoveries?
- It lags downturns by 8-20 months and recoveries by 1-10 months.
- It leads downturns by 8-20 months and recoveries by 1-10 months.
- It provides no meaningful information about downturns or recoveries.
- It provides equal information about both downturns and recoveries.
A: It leads downturns by 8-20 months and recoveries by 1-10 months.

Q: What is the main takeaway from the article about using economic indicators to forecast the economy?
- Forecasting is an exact science that can be done reliably.
- Forecasting is an art that is fraught with uncertainty.
- Forecasting is unnecessary for policymaking.
- Forecasting should be done using a single leading indicator.
A: Forecasting is an art that is fraught with uncertainty.