Exhibit 13 In Addition a Regression Analysis Indicates the Following Relationship Between

question 3

Multiple Choice

Exhibit 13.1
Use the Information Below for the Following Problem(S)
Assume that you are an analyst for the U.S. Autoparts Industry. Consider the following information that you propose to use to obtain an estimate of year 2002 EPS for the U.S. Autoparts Industry:
$\begin{array}{lrr}\begin{array}{l}\\\\\text{Personal consumption expenditures}\\\text{Personal consumption expenditures}\\ \text{growth}\\\text{Industry Sales per share}\\\text{Industry Operating profit margin}\\\text{Industry Depreciation/Fixed Assets}\\\text{Industry Fixed asset turnover}\\\text{Interest rate}\\\text{Industry Total asset turnover}\\\text{Industry Debt/Total assets}\\\text{Industry Tax rate}\\\end{array}\\begin{array}{r}\\\text{Year 2003}\\\hline\text{\$6,800 Billion}\\\\\\ \$ 525 \\\\\\\\\\\\\\\\end{array}\\begin{array}{r}Estimated\\\text{Year 2004}\\\hline\\ 1.5 \% \\\\\\ 15 \% \\8.25 \% \\3\\6 \% \\1.2 \\45 \% \\36\%\end{array}\\end{array}$

In addition a regression analysis indicates the following relationship between growth in industry sales per share and personal consumption expenditures (PCE) growth is
%D Sales per share = 0.02 + 1.5(%DPCE)
-Refer to Exhibit 13.1.Calculate industry EPS for the year 2004.

• A) $45.25
• B) $36.79
• C) $57.25
• D) $32.56
• E) $48.57

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Definitions:

Acquaintanceship Effect

The phenomenon where people tend to develop more positive evaluations of others as they become more familiar with them.

Predictions

Statements or estimates about future events based on analysis or understanding of past and current data.

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The degree to which assessments or perceptions of others’ personalities are consistent with their actual traits and behaviors.

Social Situations

Social situations involve contexts where individuals interact with one another, which can significantly influence behaviors, perceptions, and emotions.