Why do you think the change in the index of labor cost per unit of output is a useful lagging indicator of the macroeconomy?
A. Leading indicators
1. Average weekly hours of production workers (manufacturing)
2. Initial claims for unemployment insurance
3. Manufacturers’ new orders (consumer goods and materials industries)
4. Fraction of companies reporting slower deliveries
5. New orders for nondefense capital goods
6. New private housing units authorized by local building permits
7. Yield curve slope: 10-year Treasury minus federal funds rate
8. Stock prices, 500 common stocks
9. Money supply (M2) growth rate
10. Index of consumer expectations
B. Coincident indicators
1. Employees on nonagricultural payrolls
2. Personal income less transfer payments
3. Industrial production
4. Manufacturing and trade sales
C. Lagging indicators
1. Average duration of unemployment
2. Ratio of trade inventories to sales
3. Change in index of labor cost per unit of output
4. Average prime rate charged by banks
5. Commercial and industrial loans outstanding
6. Ratio of consumer installment credit outstanding to personal income
7. Change in consumer price index for services