Exhibit 9-1 USE THE FOLLOWING INFORMATION FOR THE NEXT QUESTION(S) (1) the (1)

question 25

Multiple Choice

Exhibit 9-1
USE THE FOLLOWING INFORMATION FOR THE NEXT QUESTION(S) (1) The firm's expected rate of growth of earning per share
(2) The amount of capital invested in growth investments
(3) The rate of return earned on the funds relative to the required rate of return
(4) The required rate of return on the security based on its systematic risk
(5) The firm's dividend payout ratio
(6) The time horizon when these growth investments will be available
-Refer to Exhibit 9-1. In the listing above, which three factors influence the earnings multiple for a stock?

• A) 1, 4, and 5
• B) 1, 4, and 6
• C) 2, 4, and 6
• D) 2, 5, and 6
• E) 4, 5, and 6

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Definitions:

Real Interest Rate

The interest rate adjusted for inflation, reflecting the true cost of borrowing and the true yield to the lender or investor, compared to the nominal interest rate.

Purchasing Power

The purchasing power of a currency, indicating the quantity of goods or services obtainable with one money unit.

U.S. Supply Shock

An unexpected event that suddenly changes the supply of goods or services in the U.S. economy, potentially affecting prices and leading to economic adjustments.

National Wage Rates

Standardized wage levels set or analyzed across a nation for various occupations or sectors, which can be influenced by government policy or economic conditions.