Study Guide_Chapter 14 - Chapter 14 INDUSTRY ANALYSIS 1. In...

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Chapter Fourteen Industry Analysis 176 Chapter 14 INDUSTRY ANALYSIS 1. In fundamental analysis, industry analysis is the: a. first step. b. second step. c. third step. d. fourth step. (b) 2. Standard & Poor's new Global Industry Classification system divides everything into _________economic sectors. a. 10 b. 20 c. 30 d. 40 (a) 3. A well-known and widely used system that classified industries for more than 60 years was the: a. Commercial Industrial Classification system. b. National Industrial Classification system. c. Standard Industrial Classification system. d. American Industrial Classification system. (c) 4. Which of the following covers approximately 1,700 companies, divided into 96 industries? a. SIC b. NAICS c. GICS d. Value Line Investment Survey (d) 5. Industry analysis is important because:
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Chapter Fourteen Industry Analysis 177 a. companies can only do as well as their industry. b. industries often have an inverse relationship to the market. c. industries perform very differently over time. d. companies in declining industries lose money. (c) 6. If an industry is ranked number one, based on price performance such as the S&P Industry Stock Indexes, an investor a. cannot necessarily expect that same industry to be ranked number one again next year. b. can usually depend on an industry to maintain its top ranking for five years or more. c. can expect that industry to do well over the next 10 to 20 years. d. can expect that industry to drop out of the top ten within five years. (a) 7 Which life cycle stage generally sees industries improving their products, lowering prices, and start to attract considerable investment funds? a. pioneering stage b. expansion stage c. stabilization stage d. maturity stage (b) 8. Weaker firms typically fail the most in the: a. pioneering stage. b. expansion stage. c. stabilization stage. d. maturity stage. (a) 9. The basic competitive factors facing industries include all of the following except: a. bargaining power of suppliers b. threat of government regulation
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Chapter Fourteen Industry Analysis 178 c. rivalry between existing competitors d. threat of substitute products (b) 10. Which of the following is limitation of the life cycle approach to security analysis? a.
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This note was uploaded on 06/02/2011 for the course FINA 3331 taught by Professor Staff during the Spring '08 term at Texas A&M University, Corpus Christi.

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Study Guide_Chapter 14 - Chapter 14 INDUSTRY ANALYSIS 1. In...

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