Exhibit 12.5 Use the Information Below for the Following Problem(S)

question 26

Multiple Choice

Exhibit 12.5
Use the Information Below for the Following Problem(S)
An analyst wishes to estimate the share price for Ashley Corporation. The following information is made available:
Estimated profit margin = 15%
Total asset turnover = 2
Financial leverage = 1.2
Estimated dividend payout ratio = 75%
Required rate of return = 14%
Estimated EPS = $2.50
-Refer to Exhibit 12.5.Calculate the P/E multiple.

• A) 35
• B) 30
• C) 25
• D) 20
• E) 15

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Definitions:

Vertical Axes

The y-axis in a chart or graph that typically represents the range of values or quantities for a specific variable.

Horizontal Axes

The x-axis in a graph or chart, typically representing the independent variable or the base timeline over which data is plotted.

Line Chart

A type of chart which displays information as a series of data points connected by straight line segments.

Structure Narrative

The organized way in which a story is told, including the sequence of events and the relationship between them.