Exam 12: Macroeconomic and Industry Analysis

Everything else equal, if you expect a larger interest rate increase than other market participants, you should ________.

The most widely used monetary policy tool is ________.

Attempting to forecast future earnings and dividends is consistent with which of the following approaches to securities analysis?

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

If you believe the economy is about to go into a recession you might change your asset allocation by selling ________ and buying ________.

GDP refers to ________.

Firm B produces 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 ________.

Which of the following would not be considered a supply shock?

Which one of the following is not a US supply shock?

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

Which of the following describes the rate at which your ability to purchase grows while you hold an interest-earning investment?

Which of the following is the rate at which the general level of prices for goods and services is rising?

Portfolio manager Peter Lynch would classify Coca-Cola as ________.

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?

You would expect the beta of cyclical industries to be ________ and the beta of defensive industries to be ________.

A firm in the early stages of its industry life cycle will likely have ________.

If the economy is going into a recession, a good industry to invest in would be the ________ industry.

You estimate that the present value of a firm's cash flow is $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 ________.