Question: Explain in detail the difference between leading, lagging, coincident and unclassified economic indicators
Indicators are measures of economic health. There are four indicators in economic health which include leading, lagging, coincident and unclassified economic indicators. Leading indicators are those measurable variables that predict a change in a trend in business or some phenomenon of interest. They mostly forecast future events in markets, business or in the economy and therefore they help economics in understanding where the economy is headed next. Lagging indicators are those observable factors that confirm trends and changes in trends, especially in a general economy. They are easy to identify and capture. These factors are observed sometimes after the business is correlated with changes, and therefore they decide whether to buy or sell assets in financial markets. Coincident indicators are the factors that clarify the current state of the economy in a specific area or nation. They are a real-time assessment of how an economy is performing. The state of the economy may be based on real earning, employment or even unemployment rate. Unclassified economic indicators are those other observable or measurable factors in the general economy which cannot be classified under leading, lagging or coincident indicators.
Question: Explain one way in which economic statistic can be abused
Economic statistics can be abused when the economic data are altered not to represent the facts and figures. Again, sabotaging of money is one way in which economic statistic can be abused. Those in authority may abuse their victims by not submitting the money issued to them in time and full amount.
Question: What is the difference between conditional economic and unconditional economic forecast
Conditional economic forecast explains what will happen to an output in an economy if the interest rates change while unconditional economic forecast explains what output of an economy will be at some date. The unconditional economic forecasts are performed independently without relying on an occurrence of an external factor such as interest rates.