Pharmaceutical Industry. An equities analyst is studying the pharmaceutical in-dustr• and would like your help in exploring and understanding the financial data collected by her fun. Iler main objective is to understand the structure of the phar-maceutical industry using some basic financial measures. Financial data gathered on 21 firms in the pharmaceutical industry are available in the file Pharmaceuticals. jmp. For each firm the following variables are recorded:

1. Market capitalization (in billions of dollars)

2. Beta

3. Price/earnings ratio

4. Return on equity

5. Return on assets

6. Asset turnover

7. Leverage

8. Estimated revenue growth

9. Net profit margin

10. Median recommendation (across major brokerages)

11. Location of fun's headquarters

12. Stock exchange on which the Linn is listed

Use cluster analysis to explore and analyze the given dataset as follows:

a. Use only the quantitative variables to cluster the 21 firms. Justify the various choices made in conducting the cluster analysis, such as the specific clustering algorithm/s used, and the number of clusters formed.

b. Interpret the clusters with respect to the quantitative variables that were used in Conning the clusters.

c. Is there a pattern in the clusters with respect to the qualitative variables t those not used in fonning the clusters)?

d. Provide an appropriate name for each cluster (based on variables in the dataset).

Answer rating: 100% (QA)

a I have used R programming and used KMeans algorithm to do the cluster analysis R commands to run the analysis and their output is given in sequence Read the Pharmaceuticalsxls and load it into a dat... View the full answer