Question

The price-earnings ratio of a stock that sells for $46.75 per share and earns $4.25 per share is..?

Answer 1

Answer on Question #45828 – Math – Other

Problem.

The price-earnings ratio of a stock that sells for $46.75 per share and earns $4.25 per share is..?

Solution.

The price-earnings ratio is equal to

$$P/E = \frac{P}{EPS}$$

where $P$ is price per share and $EPS$ is earning per share. Hence

$$P/E = \frac{46.75}{4.25} = 11.$$

Answer: $P/E = 11$

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