1. A higher industry P/E will result in a(n)… A. Higher required return B. Decrease in an industry’s business risk. C. Decrease in an industry’s growth rate. D. Increase in an industry’s liquidity risk. 2. Industry analysis is important because… A. It is unusual for a firm in a troubled industry to perform well. B. There are substantial differences in stock market performances among industry groups. C. There is considerable dispersion in stock market performance among industry groups. D. All of the above 3. Which of the following stages of the industry life cycle offers the highest potential returns. A. Start-up B. Consolidation C. Maturity D. Relative decline
1. A higher industry P/E will result in a(n)… A. Higher required return B. Decrease in an industry’s business risk. C. Decrease in an industry’s growth rate. D. Increase in an industry’s liquidity risk. 2. Industry analysis is important because… A. It is unusual for a firm in a troubled industry to perform well. B. There are substantial differences in stock market performances among industry groups. C. There is considerable dispersion in stock market performance among industry groups. D. All of the above 3. Which of the following stages of the industry life cycle offers the highest potential returns. A. Start-up B. Consolidation C. Maturity D. Relative decline
Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Chapter5: Risk Analysis
Section: Chapter Questions
Problem 2QE
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1. A higher industry P/E will result in a(n)…
A. Higher required return
B. Decrease in an industry’s business risk.
C. Decrease in an industry’s growth rate.
D. Increase in an industry’s liquidity risk.
2. Industry analysis is important because…
A. It is unusual for a firm in a troubled industry to perform well.
B. There are substantial differences in stock market performances among
industry groups.
C. There is considerable dispersion in stock market performance among
industry groups.
D. All of the above
3. Which of the following stages of the industry life cycle offers the highest potential
returns.
A. Start-up
B. Consolidation
C. Maturity
D. Relative decline
cle
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