The Target Company Has Sales of $2 Million, Net Income

question 10

Multiple Choice

The target company has sales of $2 million, net income of $1 million, and cash flows to equity of $1.1 million.The industry P/E ratio is 16.5.What is the valuation of the target company?

• A)$16.5 million
• B)$33 million
• C)$18.15 million
• D)$10 million

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Definitions:

Hostile Aggression

Aggressive behavior that is performed with the intent to cause harm or injury to another.

Unpleasant Events

Occurrences or situations that evoke negative emotional responses, such as discomfort, fear, or sadness.

Polygraph Test

A lie detector test that measures physiological responses, such as heart rate and blood pressure, to determine truthfulness.

Polygraph Test

A diagnostic tool used to assess the veracity of an individual's statements by measuring physiological responses to questions.