1. As a securities analyst you have been asked to review a valuation of a closely held busi- ness, Wigwam Autoparts Heaven, Inc. {WAH}, prepared by the Red Rocks Group (REG). You are to give an opinion on the valuation and to support your opinion by analyzing each part of the valuation. WAH's sole business is automotive parts retailing. The EEG valuation includes a section called \"Analysis of the Retail Auto Parts Industry," based completely on the data in Table 12.? and the following additional information: . WAH and its principal competitors each operated more than 150 stores at year-end 2016. + The average number of stores operated per company engaged in the retail auto parts industry is 5 .3. Chapter 12 Macroeconomic and Industry Analysis 389 TABLE 12.7 Selected retail auto parts industry data 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 Population 18-29 years old -1.8% -2.0% -2. 1% 6 -1.4% -0.8% -0.9% - 1.1% -0.9% -0.7% -0.3% (percentage change) Number of households with 6.0 4.0 8.0 4.5 2.7 3.1 1.6 3.6 4.2 2.2 income more than $40,000 (percentage change) Number of households with 3.0 -1.0 4.9 2.3 -1.4 2.5 1.4 -1.3 0.6 0. 1 income less than $40,000 (percentage change) Number of cars 5-15 years old 0.9 - 1.3 -6.0 1.9 3.3 2.4 -2.3 -2.2 -8.0 1.6 (percentage change) Automotive aftermarket industry 5.7 1.9 3. 1 3.7 4.3 2.6 1.3 0.2 3.7 2.4 retail sales (percentage change) Consumer expenditures on 2.4 1.8 2.1 6.5 3.6 9.2 1.3 6.2 6.7 6.5 automotive parts and accessories (percentage change) Sales growth of retail auto parts 17.0 16.0 16.5 14.0 15.5 16.8 12.0 15.7 19.0 16.0 companies with 100 or more stores Market share of retail auto parts 19.0 18.5 18.3 18.1 17.0 17.2 17.0 16.9 15.0 14.0 companies with 100 or more stores Average operating margin of 12.0 11.8 11.2 11.5 10.6 10.6 10.0 10.4 9.8 9.0 retail auto parts companies with 100 or more stores Average operating margin of all 5.5 5.7 5.6 5.8 6.0 6.5 7.0 7.2 7.1 7.2 retail auto parts companies- The major customer base for auto parts sold in retail stores consists of young owners of old vehicles. These owners do their own automotive maintenance out of economic necessity. (1.0 12-11 a. One of RRG's conclusions is that the retail auto parts industryr as a whole is in the maturity stage of the industry,r life cycle. Discuss three relevant items of data from Table 12.7Ir that support this conclusion. 1?. Another RRG conclusion is that WAH and its principal competitors are in the consolidation stage of their life cycle. Cite three items from Table 12.}r that suggest this conclusion. How can WAH be in a consolidation stage while its industry is in a rnaturit3.r stage