A Company Has Net Income of $170,016, Earnings Per Share

question 70

Multiple Choice

A company has net income of $170,016, earnings per share of $3.68, and a return on equity of 14.5 percent. If the stock is currently selling for $96.25, what is the price-book ratio?

• A) 3.21
• B) 5.02
• C) 4.29
• D) 4.68
• E) 3.79

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Definitions:

Capital Contribution

A financial investment made by an owner or shareholder into a company or partnership to fund its operations or projects.

LLCs

Limited Liability Companies, a business structure in the United States where the owners are not personally liable for the company's debts or liabilities.

First Nation

A term used in Canada to denote indigenous peoples, primarily those formerly referred to as "Indians."

Passive Investors

Investors who take a long-term strategy, typically relying on index funds or ETFs, avoiding frequent trading.