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Upon Analyzing the Financial Statements of Jain Industries,you Discover That

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Essay

Upon analyzing the financial statements of Jain Industries,you discover that it is currently retaining 60 percent of its earnings (which were $6 this past year),and is experiencing a ROE of almost 20 percent.Assuming a risk-free rate of 4 percent and a risk-premium of 8 percent,how much would you be willing to pay for Jain Industries stock on the basis of the P/E ratio approach?


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