Which of the following macroeconomic variables is

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28. Which of the following macroeconomic variables is procyclical and coincident with the business cycle? (a) Residential investment (b) Nominal interest rates (c) Industrial production (d) Unemployment Answer: C Level of difficulty: 2 Section: 8.3
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124 Abel/Bernanke • Macroeconomics, Fifth Edition 29. Which of the following macroeconomic variables is procyclical and leads the business cycle? 30. Which of the following macroeconomic variables is acyclical? 31. Which of the following macroeconomic variables is procyclical and lags the business cycle? 32. Which of the following macroeconomic variables would you include in an index of leading economic indicators? (a) Employment (b) Inflation (c) Real interest rates (d) Residential investment Answer: D Level of difficulty: 2 Section: 8.3 33. Which of the following macroeconomic variables would you exclude from an index of leading economic indicators?
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Chapter 8 Business Cycles 125 34. Industries that are extremely sensitive to the business cycle are the 35. You want to invest in a firm whose profits show large fluctuations throughout the business cycle. Which of the following would you invest in? 36. Which of the following statements is true? (a) Employment and unemployment are both coincident with the business cycle. (b) Employment and unemployment are both procyclical. (c) Employment is procyclical and unemployment is coincident with the business cycle. (d) Employment is procyclical and unemployment is countercyclical. Answer: D Level of difficulty: 1 Section: 8.3
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