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Charles P. Jones, Investment: Principles and Concepts, Twelfth Edition, John Wiley & Sons test bank.
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Charles P. Jones, Investment: Principles and Concepts, Twelfth Edition, John Wiley & Sons.
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File: Ch. 14, Chapter 14: Industry AnalysisMultiple Choice Questions
1. The second step in the fundamental analysis of common stock, after the
economy, is:
a. company
b. economy
c. industry
d. business cycle
Ans: c
Difficulty: Easy
Ref: Introduction
2. Standard & Poor's new Global Industry Classification system divides
everything into _________economic sectors.
a. 10
b. 24
c. 68
d. 154
Ans: a
Difficulty: Moderate
Ref: What is an Industry?
3. Standard and Poor's new Global Industry Classification System already
includes _______ companies.
a. 10,000 +
b. 25,000+
c. 50,000 +
d. 75,000+
Ans: b
Difficulty: Moderate
Ref: What is an Industry?
4. A well-known and widely used system that classified industries for
more than 60 years was the:
Chapter Fourteen 176
Industry Analysis
, a. Commercial Industrial Classification system.
b. National Industrial Classification system.
c. Standard Industrial Classification system.
d. American Industrial Classification system.
Ans: c
Difficulty: Easy
Ref: What is an Industry?
5. Which of the following has 10 economic sectors, 24 industry groupings, 64
industries and 139 sub-industries?
a. SIC
b. NAICS
c. GICS
d. Value Line Investment Survey
Ans: c
Difficulty: Moderate
Ref: What is an Industry?
6. 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.
Ans: c
Difficulty: Moderate
Ref: The Importance of Sector/Industry Analysis
7. If an industry is ranked number one, based on price performance of 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.
Ans: a
Difficulty: Moderate
Ref: The Importance of Sector/Industry Analysis
Chapter Fourteen 177
Industry Analysis
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