Which of the following is an example of an economic indicator?

• A. The color of currency notes
• B. Unemployment rate
• C. The number of languages spoken in a country
• D. The average temperature in a city

Answer: (B)

Verified step by step guidance

1. Understand what an economic indicator is: it is a statistic or data point that provides information about the overall health and direction of an economy.
2. Review each option and determine if it reflects economic activity or conditions:
3. The color of currency notes is a physical characteristic and does not provide information about economic performance.
4. The unemployment rate measures the percentage of the labor force that is jobless and actively seeking work, which directly reflects economic conditions.
5. The number of languages spoken in a country and the average temperature in a city are social and environmental factors, not economic indicators.
6. Conclude that the unemployment rate is the correct example of an economic indicator because it provides insight into the labor market and economic health.