Which Method of Determining a Firm's Net Worth Divides the Market

question 46

Multiple Choice

Which method of determining a firm's net worth divides the market price of the firm's stock by the annual earnings per share, and multiplies this number by the firm's average net income for the past five years?

• A) Debt/Equity Method
• B) Current Ratio Method
• C) Price-Earnings Ratio Method
• D) Long-term Asset Method
• E) Outstanding Shares Method

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Definitions:

State of Health

Refers to the overall condition of an individual's body and mind, ranging from optimal wellness to illness.

Lifestyle

The way in which a person or group lives, including patterns of social relations, consumption, entertainment, and dress.

Environment

The sum of all external conditions and influences affecting the life and development of an organism, including natural and built settings.

Ethnicity

A social group's shared cultural practices, perspectives, and distinctions that set it apart from others.