A Stock's PE Ratio Is Primarily Affected by Which Three

question 5

Multiple Choice

A stock's PE ratio is primarily affected by which three factors?

• A)Accounting practices,opportunities,and the market rate of return
• B)Dividend yield,capital gains yield,and opportunities
• C)Market rate of return,risk,opportunities
• D)Accounting practices,market rate of return,risk
• E)Risk,opportunities,accounting practices

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Definitions:

Price Makers

Entities in a market that have the power to set prices for goods or services because they hold significant control over the market or the product.

Oligopoly

A market structure in which a small number of firms dominate the market, leading to limited competition and possibly higher prices for consumers.

Market Power

The ability of a firm or group of firms to influence or control prices and total market output.

Restrict Advertising

The imposition of limitations on the timing, nature, or content of commercial advertising.