According to Peter Lynch, a Rough Rule of Thumb for Security

question 91

Multiple Choice

According to Peter Lynch, a rough rule of thumb for security analysis is that

• A) the growth rate should be equal to the plowback rate.
• B) the growth rate should be equal to the dividend-payout rate.
• C) the growth rate should be low for emerging industries.
• D) the growth rate should be equal to the P/E ratio.
• E) None of the options are correct.

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Definitions:

Gross Private Investment

The total amount of investment in the economy by private sector entities, including investments in equipment, structures, and inventory changes.

Obama

Refers to Barack Obama, the 44th President of the United States, serving from 2009 to 2017.

European Trading Organizations

Consortia or groups in Europe that facilitate trade, such as the European Free Trade Association, aiming to promote economic cooperation and reduce trade barriers.

Modern Corporation

Contemporary business entities characterized by limited liability for its owners, perpetual succession, and centralized management, often operating on a large scale.