Exam 12: Macroeconomic and Industry Analysis

An industry analysis for manufacturers of a small personal care gadget observed the following characteristics: 1. Industry sales have grown at 15-20% per year in recent years are expected to grow at 10-15% per year over the next three years, still well above the economic growth rate. 2. Some U.S. manufacturers are attempting to enter fast growing non-U.S. markets, which remain largely unexploited. 3. Some manufacturers have created a new niche in the industry by selling directly to customers through mail order. Sales for this industry segment are growing at 40% per year. 4. The current penetration rate in the U.S. is 60% of households and will be difficult to increase. 5. Manufacturers compete fiercely on the basis of price, and price wars within the industry are common. 6. Some manufacturers are able to develop new, unexploited niche markets in the U.S. based on company reputation, quality, and service. 7. Several manufacturers have recently merged, and it is expected that consolidation in the industry will increase. 8. New manufacturers continue to enter the market. -Characteristics ____ would be typical of an industry that is in the consolidation stage.

The Board of Governors of the Federal Reserve System are appointed by ____________ to serve _____________ terms.

A big increase in government spending is an example of _________.

A top-down analysis of a firm's prospects starts with an analysis of the ____.

Which one of the following is probably the most direct and immediate way to stimulate or slow the economy although it is not very useful for fine tuning economic performance?

Which of the following is not an example of fiscal policy?

Which one of the following describes the amount by which government spending exceeds government revenues?

The analysis of the determinants of firm value is called _____________.

Firm B produce gadgets.The price of gadgets is $2 each.Firm B has total fixed costs of $300,000 and variable costs of $1.40 per gadget.The corporate tax rate is 30%.If the economy is strong,the firm will sell 2,000,000 gadgets.If the economy enters a recession it will sell only half as many gadgets.If the economy is strong,the after-tax profit of Firm B will be _________.

Inflation is caused by ________________.

The supply of funds in the economy is controlled primarily by ____________.

To obtain an approximate estimate of the real interest rate,one must _________ the __________ the nominal risk-free rate.

Pharmaceuticals,food,and other necessities would be good performers during the ____ stage of the business cycle.

The discount rate is the ________.

The average duration of unemployment is _________.

Which of the following industries would most analysts classify as mature?

The nominal interest rate is 10%.The real interest rate is 4%.The inflation rate must be _________.

You can earn abnormal returns on your investments via macro forecasting ______.

You estimate that the present value of a firm's cash flow is valued at $15 million.The break up value of the firm if you were to sell the major assets and divisions separately would give $20 million.This is an example of what Peter Lynch would call a/an ___________.

An example of a highly cyclical industry is _________.