McDonald's Shares Currently Sell for $103 Per Share

question 13

Multiple Choice

McDonald's shares currently sell for $103 per share.Its expected earnings per share are $5.50.The average P/E ratio for the industry is 24.If investors expected the same growth rate and risk for McDonald's as for an average firm in the same industry,its share price would

• A)stay about the same.
• B)rise.
• C)fall.
• D)there is not enough information.

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Definitions:

Foreign Exchange Rates

The price of one currency in terms of another, determining how much of one currency can be exchanged for another in the foreign exchange market.

Nation'S Currency

The legal tender issued by a country's central bank or government, serving as the medium of exchange within the country.

Exports And Imports

Goods and services sold to other countries (exports) and goods and services purchased from other countries (imports).

Net Transfers

The difference between the total amounts of transfers received and the total amounts of transfers paid out by an individual, household, or country.