SIE Exam Practice Question 221
Question: 221
What is the type of company whose earnings are easily affected and impacted by whatever the state of the overall economy is?
Correct Answer: C
Explanation:
A cyclical company is sensitive to the current state of the overall economy and reflects whatever that may be during periods of both high and low performance. A company in a defensive industry is the least sensitive to the state of the overall economy. A company in a growth industry will see faster growth than whatever the current state of the overall economy is.
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