Industry Classification Quiz

They use industry classification schemes to summarize economic conditions.

Industry classification is a type of economic taxonomy that categorizes companies based on similar production processes, products, or behavior in financial markets. It is important because it helps summarize economic conditions for statistical agencies and allows securities analysts to track common forces acting on groups of companies.

According to the three-sector theory, economic activities are classified into primary (extraction and agriculture), secondary (manufacturing), and tertiary (services) sectors.

<p>Some authors add quaternary (knowledge) or even quinary (culture and research) sectors.</p> Signup and view all the answers

<p>Securities analysts use industry classification groupings to track common forces acting on groups of companies, compare companies' performance, and construct specialized or diversified portfolios.</p> Signup and view all the answers