Price per ratio is divided by cash flow per share ratio which is used for calculating___________?
Correct answer: D. Price to cash flow ratioHire An Accountant
- A. Dividend to stock ratio
- B. Sales to growth ratio
- C. Cash flow to price ratio
- D. Price to cash flow ratioHire An Accountant
Explanation
Dividing price per share by cash flow per share produces the price-to-cash-flow ratio, a valuation multiple showing how much investors pay for each unit of cash flow.
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About Business Finance
Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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