$ millions Fiscal 2013 Net sales... ................................ Cost of sales ........ Number of new patents .... Fiscal 2015 $81,741 $ 5,247 7,355 Fiscal 2014 $92,793 $ 5,437 7,534 $98,367 $ 5,743 6,809 Required a. Compare IBM's research and development expense to other publicly traded companies and those in the same industry, Comment on the comparison. (Hint: Refer to Exhibit 5.3.) b. IBM's spending on research and development declined during 2015. Quantify this trend. Is this of potential concern to investors? c. What other data might analysts and investors collect to form an opinion about the level and effective- ness of IBM's R&D endeavors? R&D Spending Exhibit 5.3 shows the median level of R&D spending in 2015 for the S&P 500 firms that reper R&D expense on the income statement. EXHIBIT 5.3 S&P 500 Median R&D Expense to Revenue 19.096 17.096 15.0% 13.096 11.096 9.0% 70% 5.0% 3.0% 1.09 Energy Materials Capital Goods Automobiles Consumer Durables Semiconductors Software & Services Pharmaceuticals & Biotech Food, Beverage & Tobacco Health Care Equipment Hardware & Equipment Household & Personal Products