1. In fundamental analysis, industry analysis is the:
a. first step.
b. second step
c. third step.
d. fourth step
2. Industry analysis is important because:
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.
3. Which life cycle stage generally sees industries improving their products, and start to attract considerable investment funds?
a. pioneering stage
b. expansion stage
c. stabilization stage
d. maturity stage
4. The basic competitive factors facing industries include all of the following except:
a. bargaining power of suppliers
b. threat of government regulation
c. rivalry between existing competitors
d. threat of substitute products
5. When conducting industry analysis, investors should consider the historical record of all the following except:
a. sales growth.
b. earnings growth
c. interest rates.
d. price performance
6. Which of the following is not considered an interest-rate sensitive industry?
a. building industry
b. banking industry
c. financial services industry
d. Pharmaceuticals
7. The beginning and ending of a business cycle is also known as a:
a. cycle.
b. trough
c. peak.
d. contraction
8. Which of the following statements concerning the stock market and the economy is true?
a. The stock market generally leads the economy.
b. The stock market generally follows the economy.
c. The stock market has an inverse relationship with the economy.
d. The stock market has little relationship with the economy.
9. Generally, when interest rates fall, stock prices
a. rise.
b. fall.
c. remain unchanged.
d. rise or fall depending on the expected inflation premium.
10. If someone was to tell you that "the market" was up by two percent, they generally mean that __________ up by two percent.
a. the level of a stock price index was
b. retail prices of goods went
c. productivity was
d. costs were