Question

Determining firm performance is a complex interaction of firm effects and industry effects, with other factors also considered. Based on historical analysis, what do we know about firm and industry effects

Answer 1

Answer and Explanation:

As per the historical analysis the explanation is shown below:-

a. Management decisions have a major role to play in firm results, rather than firm impact.

b. The influence of macro-environmental effects like recession is greater than that of either firm or industrial effects.

c. The firm effects have a greater impact on results than on the effects on industry.

d. The effects of the industry get more effect on results than firm effects.