The Following Information Is Available for Taylor Company: Which

question 25

Multiple Choice

The following information is available for Taylor Company: Which of the following statements is correct?

• A) The price-earnings ratio is 20 and a share of common stock was selling for 20 times the amount of earnings per share at the end of 2012.
• B) The price-earnings ratio is 5.0% and a share of common stock was selling for 5.0% more than the amount of earnings per share at the end of 2012.
• C) The price-earnings ratio is 10 and a share of common stock was selling for 125 times the amount of earnings per share at the end of 2012.
• D) The market price per share and the earnings per share are not statistically related to each other.

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Definitions:

Specific Performance

A legal remedy in contracts law requiring a party to perform their obligations under a contract, rather than paying damages for breach.

Aficionado's

Enthusiasts or devotees to a particular interest or activity.

Recourse

The legal right to demand compensation or redress, typically in a financial context, like seeking recourse for a defaulted loan.

Down Payment

An initial payment made when something is bought on credit, representing a fraction of the full purchase price.