Dow jones transportation average

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The Dow Jones Transportation Average (DJTA) is an average of the share prices of 20 transportation companies. According to the “Dow Theory,” demand for goods is reflected in the amount of cargo carried by transportation companies and delivered to consumers and businesses. A higher DJTA correlates to a greater need for cargo transportation, while a lower DJTA correlates to a lesser need for cargo transportation. Suppose that the U.S. economy is at Situation (1), and recently, the DJTA decreases by 20%. According to the Dow Theory, the recent decrease in the DJTA most likely means that _____.

Reference no: EM131099119

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