Which of the Following Is Most Likely to Result in a Higher

question 32

Multiple Choice

Which of the following is most likely to result in a higher P/E ratio for a firm,other things equal?

• A) Lower growth rate in dividends
• B) Reduction in the stock's required rate of return
• C) Lower dividend yield
• D) Lower stock price

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Definitions:

Consideration

The value promised, given, or performed that motivates parties to enter into a contract, being essential for its validity.

Indorser

A person who endorses a negotiable instrument.

Rights

Entitlements or permissions, either granted by law or moral principles, allowing individuals to perform certain actions or to be treated in specific ways.

Holder in Due Course

A legal term describing a person who has acquired a negotiable instrument in good faith for value and without notice of certain defects.