The price per ratio is divided by cash flow per share ratio, is used for calculating __________?
Correct answer: D. price to cash flow ratio
- A. dividend to stock ratio
- B. sales to growth ratio
- C. cash flow to price ratio
- D. price to cash flow ratio
Explanation
The price-to-cash-flow ratio is calculated by dividing price per share by cash flow per share. It measures how much investors pay for each unit of cash flow generated per share.
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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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