1.Rapid accelerating growth illustrates:

A)   lots of competition.

B)   large developmental costs.

C)   a decrease in the P/E ratio.

D)   rise in profit margins.

2.Which of the following is NOT one of the stages in the industry life cycle?

A)   Consolidation.

B)   Pioneering.

C)   Mature growth.

D)   Stabilization and market maturity.

3.Which of the following statements concerning industry analysis is least accurate?

A)   The influx of competition typically occurs in the mature growth stage of the industry life cycle.

B)   Industry growth rates are a function of retention rates and return on equity (ROE).

C)   If the industry growth rate is 7 percent, the dividend payout ratio is 40 percent, the risk-free rate is 4 percent, the expected market return is 10 percent, and the industry beta is 1.15, the industry P/E ratio is expected to be 10.26.

D)   In the stabilization and market maturity phase of the industry life cycle, sales growth remains above normal but is no longer accelerating.

4.Which of the following statements concerning industry analysis is FALSE?

A)   The profit margin is highest for the rapid accelerating growth stage of the industry life cycle.

B)   If the dividend payout ratio is 40 percent, the profit margin is 12 percent, asset turnover is 1.45 times, and asset/equity leverage factor is 2.2, the industry's projected growth rate is approximately 23 percent.

C)   Retention and dividend payout ratios differ among industries.

D)   During the mature growth phase of the industry life cycle, sales growth is equal to the average growth rate of the economy.

5.Which of the following statements concerning the industry life cycle is FALSE?

A)   Slow growth in an industry leads to increased competition among firms for market share.

B)   Barriers to entry into an industry lead to prolonged periods of above-average profit margins.

C)   During the rapid accelerating growth phase of the industry life cycle, profit margins will be small.

D)   The bargaining power of buyers is an important determinant of profit margins.

答案和详解如下：

1.Rapid accelerating growth illustrates:

A)   lots of competition.

B)   large developmental costs.

C)   a decrease in the P/E ratio.

D)   rise in profit margins.

The correct answer was D)

Rapid accelerating growth is typically related to a large increase in demand, limited competition, high sales growth, and high profit margins.

2.Which of the following is NOT one of the stages in the industry life cycle?

A)   Consolidation.

B)   Pioneering.

C)   Mature growth.

D)   Stabilization and market maturity.

The correct answer was A)

Consolidation is not one of the stages in the industry life cycle.

3.Which of the following statements concerning industry analysis is least accurate?

A)   The influx of competition typically occurs in the mature growth stage of the industry life cycle.

B)   Industry growth rates are a function of retention rates and return on equity (ROE).

C)   If the industry growth rate is 7 percent, the dividend payout ratio is 40 percent, the risk-free rate is 4 percent, the expected market return is 10 percent, and the industry beta is 1.15, the industry P/E ratio is expected to be 10.26.

D)   In the stabilization and market maturity phase of the industry life cycle, sales growth remains above normal but is no longer accelerating.

The correct answer was D)

In the industry life cycle, sales growth declines to a level that is in line with the economy in the when the product reaches the "stabilization and market maturity" phase. Growth that is above normal but no longer accelerating more accurately describes the "mature growth" phase. The mature growth phase is when competitors tend to enter the market and narrow the industry's profit margins.

The industry P/E ratio = Dividend payout ratio / (k – g). We are given the dividend payout ratio = 40%, g = 7%, Rf = 4%, Market return = 10%, beta = 1.15, and given this we need to find k to calculate the P/E ratio. K is found from the CAPM model where k = Rf + Beta(Market return – Rf) = .04 + 1.15(.1-.04) = .109 or 10.9%. Thus the P/E ratio = .4/(.109 - .07) = 10.26

4.Which of the following statements concerning industry analysis is FALSE?

A)   The profit margin is highest for the rapid accelerating growth stage of the industry life cycle.

B)   If the dividend payout ratio is 40 percent, the profit margin is 12 percent, asset turnover is 1.45 times, and asset/equity leverage factor is 2.2, the industry's projected growth rate is approximately 23 percent.

C)   Retention and dividend payout ratios differ among industries.

D)   During the mature growth phase of the industry life cycle, sales growth is equal to the average growth rate of the economy.

The correct answer was D)

During the mature growth phase of the industry life cycle, sales growth is above the average growth rate of the economy, but sales growth is no longer accelerating.

5.Which of the following statements concerning the industry life cycle is FALSE?

A)   Slow growth in an industry leads to increased competition among firms for market share.

B)   Barriers to entry into an industry lead to prolonged periods of above-average profit margins.

C)   During the rapid accelerating growth phase of the industry life cycle, profit margins will be small.

D)   The bargaining power of buyers is an important determinant of profit margins.

The correct answer was C)

During the rapid accelerating growth phase of the industry life cycle, profit margins will be very high.