Question

Calculate the price-earnings ratio from the following information. Market price per share of common stock $42.5...

Calculate the price-earnings ratio from the following information.

Market price per share of common stock $42.5
Earnings per share of common stock $2.5
a. 18
b. 16
c. 17
d. 22
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Answer #1

The correct answer is option C

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Market price per share of common stock Price - earnings(P/E) ratio = Earnings per share on common stock $42.5 $2.5

Price-earnings (P/E) ratio = 17

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