Which of the Following Is NOT Considered in the Price-Earnings

question 118

Multiple Choice

Which of the following is NOT considered in the price-earnings ratio technique?

• A) firm's required rate of return on equity (k)
• B) firm's dividend payout ratio (D/E)
• C) firm's expected growth rate of dividends (g)
• D) All of these are correct (that is, all are components of the P/E ratio).
• E) None of these are correct (that is, none are components of the P/E ratio).

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Definitions:

Customization

Making products to meet a particular customer’s needs or wants.

Transformation Process

The conversion of inputs (such as raw materials, information) into outputs (products or services) through a set of operations.