If a Company's P/E Ratio Is 12

question 87

Multiple Choice

If a company's P/E ratio is 12.5 and the company's share price is $17.50 per share then the company's EPS is:

• A)$0.71.
• B)$1.40.
• C)$5.00.
• D)$0.40.

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Definitions:

Sensory Adaptation

The method through which sensory receptors decrease in sensitivity to unchanging stimuli, enabling people to concentrate on environmental variations.

Difference Threshold

The smallest detectable difference between two stimuli or the minimum change in stimulus intensity that can be sensed.

Absolute Threshold

The minimum intensity of stimulus that is required for a person to detect its presence 50% of the time.

Light Bulbs

Devices that produce light from electricity, consisting of a filament that glows when heated by an electric current.