The Closing Price of a Stock Is Quoted at 22

question 98

Multiple Choice

The closing price of a stock is quoted at 22.87, with a P/E of 26 and a net change of 1.42. Based on this information, which one of the following statements is correct?

• A) The closing price on the previous day was $1.42 higher than today's closing price.
• B) A dealer will buy the stock at $22.87 and sell it at $26 a share.
• C) The stock increased in value between yesterday's close and today's close by $.0142.
• D) The earnings per share are equal to 1/26th of $22.87.
• E) The earnings per share have increased by $1.42 this year.

---

Definitions:

Financing Nature

The characteristic manner or method in which a company prefers to finance its operations, typically equity, debt, or a hybrid.

Spontaneous Financing

Financing provided by current liabilities that arise automatically as a result of doing business.

Accounts Payable

Short-term liabilities a company owes to its creditors or suppliers, expected to be settled within one year.

Bank Loan

A sum of money borrowed from a bank that needs to be repaid with interest.