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Igoryamba
3 years ago
7

12. A company has an EPS of $2.00, a book value per share of $20, and a market/book ratio of 1.2x. what is its P/E ratio

Business
1 answer:
Tcecarenko [31]3 years ago
5 0

Answer:

P/E Ratio = 12x or 12 times

Explanation:

We know that the P/E ratio is calculated by dividing the price per share by the earnings per share or EPS.

P/E = Price per share / Earnings per share

We already have EPS. We need to calculate the price per share.

It is given that book value per share is $20 and the market to book ratio is 1.2x or 1.2 times. Using the formula for market to book ratio, we calculate the market price per share to be,

M/B = Market price per share / Book value per share

1.2 = Market price per share / 20

20 * 1.2 = Market price per share

Market price per share = $24

So, P/E ratio = 24 / 2

P/E Ratio = 12x or 12 times

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1. The giving up of one benefit or advantage in order to gain another regarded as more favorable.
Serjik [45]

Answer:

1. Trade off

2. Opportunity cost

3. Cost-benefit analysis

4. Diminishing marginal utility

Explanation:

1. Giving up one benefit or advantage to gain another regarded as more favorable is called trade-off. Every economic decision involves some trade-off.

2. Opportunity cost is the second-best alternative or value of the alternative, that must be given up when making a choice. Because of scarce resources with alternative uses allocation of resources involves some opportunity cost.

3. Cost-benefit analysis can be defined as the process of examining the benefits and costs of each available alternative in arriving at a decision. Resources are allocated efficiently if the cost incurred and benefit earned is equal.

4. As we go on increasing the quantity consumed of a product, the marginal utility or satisfaction earned from its consumption goes on decreasing. This is called diminishing marginal utility.

7 0
2 years ago
Actual sales volume for a period is 5,000 units. Budgeted sales volume is 4,500. Actual selling price per unit is $15 and budget
dlinn [17]

If the actual sales volume is 5000 units,budgeted sales volume is 4500, actual selling price be $15 per unit and the budgeted price per unit be $15.75 per unit then the sales price variance is -$3750.

Given that actual sales volume is 5000 units,budgeted sales volume is 4500 units, actual selling price be $15 per unit and budgeted price per unit be $15.75 per unit.

We are required to find the sales price variance of the data.

Actual Sales volume = 5,000 units

Budgeted sales volume = 4,500

Actual selling price per unit = $15

Planned selling price = $15.75

So, calculation of the sales price variance is given below:-

Sales variance =Actual quantity sold × (actual selling price - planned selling price)

=5000*(15-15.75)

=5000*(-0.75)

=-$3750

Hence if the actual sales volume is 5000 units,budgeted sales volume is 4500, actual selling price be $15 per unit and the budgeted price per unit be $15.75 then the sales price variance is -$3750.

Learn more about variance at brainly.com/question/15858152

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6 0
1 year ago
Cragmont has beginning equity of $277,000, net income of $63,000, withdrawals of $25,000 and no additional investments by owners
Andrew [12]
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3 0
3 years ago
You will need $228,790 in 28 years to supplement your retirement funds. if you can earn 8% interest, you must save $________ eac
kodGreya [7K]
You will need $228,790 in 28 years to supplement your retirement funds. If you can earn 8% interest, you must save $2,400 each year. ✅
3 0
3 years ago
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In the context of the job characteristics model, _____ is the extent to which a job includes a recognizable unit of work that is
kotykmax [81]

Answer:

Explanation: The job characteristics model explains that the objective characteristics of a job itself, including skill variety, task identity, task significance, autonomy, and task feedback, lead to job satisfaction for people with a high growth need strength. In  more simpler terms, it is based on the idea that a task in itself is the key to the employee's motivation. In the context of the job characteristics model, Task identity describes the extent to which the job includes a recognizable unit of work that is carried out from start to finish and results in a known consequence.

7 0
2 years ago
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