A Company Currently Has Sales of $3,400,000, Net Profit of $268,000

question 122

Multiple Choice

A company currently has sales of $3,400,000, net profit of $268,000 and 400,000 shares of stock outstanding. The sales and net profit each expected to grow by 7.5% annually. The historical price/sales ratio is 8.5, what price would you project for the stock next year?

• A) $79.23
• B) $72.56
• C) $74.02
• D) $77.67
• E) $76.12

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Definitions:

Downsizing

The process of reducing a company's size through layoffs, closures, or scaling back operations, often for efficiency or cost-saving reasons.

Reengineering

The fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical measures of performance such as cost, quality, service, and speed.

ISD Model

Instructional Systems Design (ISD) Model refers to a systematic process used to develop educational and training programs in a consistent and reliable fashion.

Identification

The process of recognizing or establishing the identity of a person or thing.