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

question 74

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.Obtain an estimate of the per share depreciation charge for the year 2004.

• A) $15.81
• B) $12.35
• C) $23.68
• D) $25.93
• E) $35

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Definitions:

Basilar Membrane

A key structure in the cochlea of the inner ear, responsible for converting sound vibrations into neural signals by moving in response to different frequencies.

Theory of Hearing

A scientific explanation detailing how sound waves are detected by the ear and interpreted by the brain as sounds.

Frequency Theory

A theory of hearing which suggests that the frequency of the auditory nerve's impulses corresponds to the frequency of a sound wave, enabling us to detect pitch.

Pitch Perception

The auditory sensation through which a listener can identify musical notes as higher or lower in the scale, fundamentally dependent on the frequency of the sound wave.