1) Which of the following is the most significant positive factor in the future profitability of the pharmaceutical industry?

a) Research and development of new drugs

b) government regulation

c) demographics

d) patents

2) A rotational investor will rotate through stocks that perform well in different stages of the economy in which order (from trough to peak)?

a) Basic materials; consumer cyclical; consumer noncyclical; household durable goods

b) Consumer cyclical; basic materials; consumer noncyclical; household durable goods

c) Basic materials; household durable goods; consumer cyclical; consumer non-cyclical

d) Household durable goods; consumer cyclical; consumer noncyclical; basic materials e) Household durable goods; basic materials; consumer noncyclical; consumer cyclical.

3) Why would an investor want to use the rotational investing method?

a) It allows the investor to rotate out of losing stocks

b) the investor is attempting to profit from movements in the economic cycle

c) it is an easy method of employing dollar cost averaging

d) It assures the investor of owning the proper mix of stocks and bonds

4) Which of the following industries was not mentioned as an example of a consumer non-cyclical industry?

a) utility companies

b) food stocks

c) household products (Durables)

d) Tobacco stocks

5) Which of the following industry sectors would an investor want to purchase at the trough of the business cycle?

a) basic materials

b) consumer noncyclical goods

c) consumer cyclical goods

d) household durable goods