- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 2. Understanding Business Cycles
- Subject 3. Economic Indicators over the Business Cycle
CFA Practice Question
If you observe that the number of building permits has increased steadily over the past 2 quarters, it is highly likely that an upturn ______
A. has occurred.
B. is just about to occur.
C. will occur sometime in the future.
Explanation: This gauge is a leading indicator. It foretells new construction activity.
User Contributed Comments 3
| User | Comment |
|---|---|
| jejasin | I thought it was lagging because it was a sign that the business had more money from the recovering economy =/ |
| farhan92 | it did say 2 quarters that made me more inclined to think it was a. |
| shumwaya | think of how long it takes to put up a new building. The area won't start to experience economic benefit from the buildings until they open, therefore it is happening in the future. |