During the 2008-2009 Recession,the Average P/E Ratio of Firms in the U.S.stock

question 9

Multiple Choice

During the 2008-2009 recession,the average P/E ratio of firms in the U.S.stock market reached an extraordinarily high level because ________.

• A)investors believed short-term growth prospects for U.S.firms were extraordinarily good at that time
• B)stock prices generally boomed during the recession
• C)earnings per share were unusually low during the recession
• D)investors believed long-term growth prospects coming out of the recession were not very good

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Definitions:

Special Meeting

A meeting called for a specific purpose, distinct from regular meetings, often to address urgent issues within an organization.

Derivative Suit

A lawsuit brought by a shareholder on behalf of a corporation against a third party, often the corporation's executives or directors, due to failure in their corporate duties causing harm to the company.

Similarly Situated Shareholders

Shareholders in a corporation who are in comparable positions, typically concerning their rights and interests.

Current Shareholder

An individual or entity that currently owns shares in a company.