The Average Japanese P/E Ratio Was Reported as Between 40

question 35

Multiple Choice

The average Japanese P/E ratio was reported as between 40 and 100 in recent years while the average U.S. P/E ratio was 25. The reason for the higher Japanese P/E ratio has been partially explained by:

• A) growth opportunities over stated earnings.
• B) understated earnings and low interest rates.
• C) overstated earnings and low interest rates.
• D) understated earnings and overstated growth opportunities.
• E) low interest rates and greater growth opportunities.

Distinguish between the functions of punishment and negative reinforcement

Identify examples of behavioral modification techniques

Recognize the role of antecedents and discriminative stimuli in shaping behavior

Understand the process and effects of operant extinction

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Definitions:

Carrying Amount

The book value of assets or liabilities on a company's balance sheet, calculated as the original cost minus any depreciation, amortization, or impairment charges.

Equity Method

A method of accounting whereby the investment is initially recognised at cost and adjusted thereafter for the post-acquisition change in the investor’s share of the investee’s net assets. The investor’s profit or loss includes its share of the investee’s profit or loss and the investor’s other comprehensive income includes its share of the investee’s other comprehensive income.

Investment

An asset or item acquired with the goal of generating income or appreciation over time.

Carrying Amount

The amount at which an asset or liability is recognized in the balance sheet, which can be the historical cost less any depreciation, amortization, or impairment.