Question

last year, high-tech electronics earned $2.00 per share. if a share of its stock is selling for $60, what is the firm's p-e ratio?

Answer 1

Based on the calculation done below, the firm's p-e ratio is 30.

How do we calculate the p-e ratio?

The price-earning (p-e) ratio can be calculated using the following formula:

p-e ratio = MPS / EPS ............................................................. (1)

Where:

MPS = Market price per share = Share selling price = $60

EPS = Earning per share = $2.00

Substituting the values into equation (1), we have:

p-e ratio = $60 / $2.00 = 30

Learn more about the price-earnings ratio here: https://brainly.com/question/15520260.

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