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stellarik [79]
3 years ago
5

Which of the following statements is FALSE? For valuation purposes, the trailing P/E ratio is generally preferred, since it is b

ased on actual not expected earnings. Trailing earnings are the earnings over the previous 12 months. Forward earnings are the expected earnings over the coming 12 months. We can estimate the value of a firm's shares by multiplying its current earnings per share by the average P/E ratio of comparable firms.
Business
1 answer:
Alecsey [184]3 years ago
8 0

Answer:

The statement that is false here is A) trailing P/E ratio are used for valuation because it is based on actual not expected earnings.

Explanation:

For the valuation purposes , the most preferred P/E ratio is forward P/E ratio, not the trailing P/E ratio because here we are more concerned about future earnings not the current. These forwards earnings are the earnings which are expected over the coming year or 12 months of time.

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Releasing more information, in a common-value auction is a. ​Good for the bidders because it reduces the risk that they face b.
neonofarm [45]

Answer:

d. ​Both A&B

Explanation: Auction is a term used in the field of marketing or trading of goods where bidders are allowed to make bids(amount which they intend to pay for a given product) the Product can either be an Artwork or other goods like furniture,Cars, clothes etc.

A common value auction is a type of auction where certain information about the value of a product are available to some bidders and other sets of bidders have other information about the value.

DISPLAYING INFORMATION ABOUT A COMMON VALUE AUCTION IS GOOD FOR THE BIDDERS AS IT REDUCES THE RISK THEY FACE ESPECIALLY BEFORE BUYING THE PRODUCT AND FOR THE AUCTIONEER AS IT HELPS TO ATTRACT MORE BIDDERS.

3 0
2 years ago
Which economic system leaves production decisions completely up to the producers? 1. mixed economy 2. command economy 3. planned
ozzi

Answer:

4. free-market economy

Explanation:

Free-market economy -

A free market refers to the economic system which depends on the demand and supply , where the control of government is nil , is referred to as free - market economy.

It helps to provide all the voluntary exchange occurring in the economy.

The range of the free market economy of a particular country , is present in between very large or completely black market.

Hence, from the given statement of the question,

The correct term is free - market economy.  

7 0
3 years ago
You are given two choices of​ investments, Investment A and Investment B. Both investments have the same future cash flows. Inve
valina [46]

Answer:

C. The present value of cash flows in Investment A is higher than the present value of cash flows in Investment B.

Explanation:

Typically, discount rate represents cost of capital or funds used to finance the investment. This implies that the higher the cost of capital , the lower the present value of cash inflow on the investment and vice-versa.

Hence, the present value of cash flows in Investment A is higher than the present value of cash flows in Investment B,  because A has a lower discount rate.

3 0
3 years ago
Anita is an entrepreneur who is interested in starting a hair salon. Anita consulted her friend Ali, who is a businessman, to ge
Varvara68 [4.7K]

ANSWER 1. Capital

EXPLANATION: Calculating capital is necessary for a business. It is the basic duty of an entrepreneur to calculate capital before starting any business to check the financial capacity of the entrepreneur. Calculating capital also helps to estimate if any outside finance is necessary to start the business.

ANSWER 2: Set of Services

EXPLANATION: Choosing and categorizing set of services is necessary before starting any business. This will help in acquiring expert and trained set of labors to carry out the work. The clients will also come to know of the services that are available in the business. Expert and trained set of labors are difficult to find in any market.

ANSWER 3: Total Cost of Ownership

EXPLANATION: Total cost of ownership is a financial estimate intended to help buyers and owners determine the direct and indirect costs of a product or system. Each and every piece of equipment that Anita buys is added to the cost of the ownership of the business.

4 0
3 years ago
Read 2 more answers
WinterDreams operates a Rocky Mountain ski resort. The company is planning its lift ticket pricing for the coming ski season. In
Kitty [74]

Answer:

a. Would Mountain Point emphasize target pricing or cost-plus pricing? Why?

  • They emphasize cost plus pricing because the investors are seeking a desired rate of return on their investment and they do it by adding the desired profit margin to their costs.

b. If other resorts in the area charge $66 per day, what price should Mount Snow charge?

  • $75.50 in order for them to generate the required ROI. Since the resort has a very good reputation, it can charge a higher price than its competitors.

Explanation:

company's assets = $115,000,000

expected return on investment = 16%

fixed costs = $35,600,000

number of customers = 800,000

variable costs = $8 per customer x 800,000 = $6,400,000

total costs = $42,000,000

total cost per client = $42,000,000 / 800,000 = $52.50

desired profit = $115,000,000 x 16% = $18,400,000

desired profit per client = $18,400,000 / 800,000 = $23

price per ticket = $75.50

8 0
3 years ago
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