The reason that the shares of steel,automobile and chemical companies are regarded as "cyclical" is that the high fixed costs of these industries make profits highly sensitive to changes in the level of demand.

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Quizplus · Accepted Answer

The statement is true. Due to their high fixed costs, steel, automobile, and chemical companies are highly dependent on the level of demand, which can fluctuate with economic cycles. This makes their profits and share prices sensitive to overall economic conditions, making them cyclical industries.

The Reason That the Shares of Steel,automobile and Chemical Companies