Which of the Following Variables Affect the P/E Ratio

question 117

Multiple Choice

Which of the following variables affect the P/E ratio?
I. capital structure of a firm
II. amount of dividends to be paid
III. inflation rate
IV. earnings rate of growth

• A) I, II and III only
• B) I, II and IV only
• C) I, III and IV only
• D) I, II, III and IV

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Definitions:

Employee Wages

Payment given to workers for their services, usually determined by the hour, day, or work completed.

Net Income

The amount of money remaining after all operating expenses, taxes, and interest have been subtracted from total revenue.

Adjusting Entries

Journal entries made at the end of an accounting period to allocate income and expenditure to the period in which they actually occurred.

Liability and Asset Accounts

Accounts on a balance sheet that represent obligations to pay others (liabilities) and resources owned by a company (assets).