The stocks of building firms
1)are considered to be cyclical
2)are sensitive to changes in interest rates
3)generally have stable earnings

Question

Quizplus · Accepted Answer

Building firms are considered to be cyclical because they are heavily linked to economic cycles and tend to perform well in times of economic expansion and poorly during recessions. They are also sensitive to changes in interest rates because higher rates can make borrowing more expensive for builders, potentially reducing demand for their services. However, building firms generally have stable earnings because they provide essential products and services that are always in demand, even during economic downturns.

The Stocks of Building Firms