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CFA Level 2
Equity Investments

Growth Analysis: R&D Investment in Technology Firms

Easy Industry And Company Analysis Growth Analysis

In the context of growth analysis within the equity investment framework, investors often look for signals that might indicate a company's potential for future revenue and profit growth. One key aspect in evaluating a company's growth is the analysis of its industry. Suppose you are analyzing a technology firm that has recently increased its R&D spending significantly. What is the most likely reason for this increased spending in relation to growth prospects?

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