You are employed by the state bureau of economic development. There is a demand for a leading economic index to review past economic activity and to forecast future economic trends in the state. You decide that several key factors should be included in the index: number of new businesses started during the year, number of business failures, state income tax receipts, college enrollment, and the state sales tax receipts. Here are the data for 2000 and 2018. New businesses. Business failures State income tax receipts ($ millions) College student enrollment. State sales tax ($ millions) Click here for the Excel Data File Leading economic indicator 2000 1,125 592 196.2 242,159 46.1 The weights you assign are: new businesses 17%, business failures 10%, income tax 34%, enrollment 14% and sales tax 25%. b. Compute the leading economic indicator for 2018. (Round your answer to 2 decimal places.) Economic activity has 2018 1,059 286 decreased increased 178.8 291,079 66.7 c. Interpret the indexes. (Round your answer to 2 decimal places.) % between 2000 and the 2018.

You are employed by the state bureau of economic development. There is a demand for a leading economic index to review past economic activity and to forecast future economic trends in the state. You decide that several key factors should be included in the index: number of new businesses started during the year, number of business failures, state income tax receipts, college enrollment, and the state sales tax receipts. Here are the data for 2000 and 2018. New businesses. Business failures State income tax receipts ($ millions) College student enrollment. State sales tax ($ millions) Click here for the Excel Data File Leading economic indicator 2000 1,125 592 196.2 242,159 46.1 The weights you assign are: new businesses 17%, business failures 10%, income tax 34%, enrollment 14% and sales tax 25%. b. Compute the leading economic indicator for 2018. (Round your answer to 2 decimal places.) Economic activity has 2018 1,059 286 decreased increased 178.8 291,079 66.7 c. Interpret the indexes. (Round your answer to 2 decimal places.) % between 2000 and the 2018.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

You are employed by the state bureau of economic development. There is a demand for a leading economic index to review past
economic activity and to forecast future economic trends in the state. You decide that several key factors should be included in the
index: number of new businesses started during the year, number of business failures, state income tax receipts, college enrollment,
and the state sales tax receipts. Here are the data for 2000 and 2018.
New businesses
Business failures
State income tax receipts ($ millions)
College student enrollment
State sales tax ($ millions)
Click here for the Excel Data File
Leading economic indicator
The weights you assign are: new businesses 17%, business failures 10%, income tax 34%, enrollment 14% and sales tax 25%.
b. Compute the leading economic indicator for 2018. (Round your answer to 2 decimal places.)
2000
1,125
592
196.2
242,159
46.1
Economic activity has
2018
1,059
286
178.8
291,079
66.7
c. Interpret the indexes. (Round your answer to 2 decimal places.)
decreased
increased
% between 2000 and the 2018.

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