- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 11. Understanding Business Cycles
- Subject 6. Unemployment
CFA Practice Question
Which statement about the unemployment rate is true?
II. The unemployment rate can continue to rise even after the economy has started to recover.
I. If the unemployment rate is rising, it indicates that the economy has been doing poorly.
II. The unemployment rate can continue to rise even after the economy has started to recover.
Correct Answer: Both statements are true.
The unemployment rate is a lagging indicator. It is a powerful confirmation of what the other indicators are already showing.
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