Lester's Has a Market Value Balance Sheet as Shown Below

question 69

Multiple Choice

Lester's has a market value balance sheet as shown below. The firm currently has 7,500 shares of stock outstanding at a price per share of $40. Net income is $9,500. The firm has decided to repurchase $20,000 worth of its outstanding stock. What will the firm's PE ratio be after this repurchase, all else held constant?

• A) 23.39
• B) 28.76
• C) 29.47
• D) 30.13
• E) 32.16

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