US CMA Part 1 · Chapter 3 · Question 28 of 30
Which of the following is best described as a leading indicator of future financial performance?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) The percentage of customers rating the company's service as excellent
Explanation
Leading indicators are drivers that predict future outcomes; customer satisfaction often signals future repeat sales and revenue. ROI, EPS and operating income are lagging indicators that report the results of past actions.
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