Price per share divided by earnings per share is formula for calculating_________?
Correct answer: A. Price earnings ratio
- A. Price earnings ratio
- B. Earning price ratio
- C. Pricing ratio
- D. Earning ratio
Explanation
The price-earnings ratio is calculated as market price per share divided by earnings per share. It shows how much investors are paying for each unit of current earnings.
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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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