Use the Following Information to Answer the Question(s)below

question 72

Multiple Choice

Use the following information to answer the question(s) below.
-Assuming that Novartis AG (NVS) has an EPS of $3.35,based upon the P/E ratios for its competitors,the highest expected stock price for Novartis is closest to:

• A)$31.86.
• B)$44.35.
• C)$51.09.
• D)$62.60.

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Definitions:

Contribution Margin

This metric represents the difference between sales revenue and variable costs, indicating how much revenue contributes towards covering fixed costs and generating profit, essentially restating the importance of covering variable expenses to achieve profitability.

Unit Sold

The quantity of products sold by a company over a specific period.

Selling Price

The amount of money charged for a product or service, determined by factors such as cost, demand, competition, and market conditions.

Contribution Margin

It represents the amount of revenue remaining after deducting variable costs, which can then be used to cover fixed costs and generate profit.