Firms with Higher Expected Growth Rates Tend to Have P/E

question 60

Multiple Choice

Firms with higher expected growth rates tend to have P/E ratios that are ________ the P/E ratios of firms with lower expected growth rates.

• A)higher than
• B)equal to
• C)lower than
• D)There is not necessarily any link between risk and P/E ratios

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Definitions:

Word Of Mouth

The process of consumers sharing information and opinions about products and services with others in their social networks, which significantly influences purchasing decisions.

Local Banker

A banker who operates within a specific regional area, often familiar with the local market and community-based financing needs.

Local College

A post-secondary institution usually offering a range of degrees and certificates primarily serving students in its surrounding geographical area.

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A group of loyal customers a business has successfully developed over time, which forms the core of its regular buyers or clients.