Suppose That the Average P/E Multiple in the Oil Industry

question 105

Multiple Choice

Suppose that the average P/E multiple in the oil industry is 22.Exxon is expected to have an EPS of $1.50 in the coming year.The intrinsic value of Exxon stock should be _____.

• A)$33.00
• B)$35.55
• C)$63.00
• D)$72.00
• E)none of the above

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Definitions:

Landlord-Tenant Relationship

The legal arrangement and duties between a property owner and a person renting or leasing that property.

Severity

in the context of risk management, describes the extent of impact or damage a risk event could potentially cause.

History

The study of past events, particularly in human affairs, often documented and analyzed to understand how societies have evolved over time.

Paying Rent

The process of making periodic payments for the use of property, typically land or buildings, that is owned by another party.