Question: A price - earnings ratio or P / E ratio is calculated as a firm s share price compared to the income or profit earned
A priceearnings ratio or PE ratio is calculated as a firms share price compared to the income or profit earned by the firm per share. Generally, a high PE ratio suggests that investors are expecting higher earnings growth in the future compared to firms with a lower PE ratio. The accompanying table shows a portion of the PE ratios for firms. a Calculate the thth and th percentiles A priceearnings ratio or P E ratio is calculated as a firm's share price compared to the income or profit earned by the firm per share. Generally, a high PE ratio suggests that investors are expecting higher earnings growth in the future compared to firms with a lower P E ratio. The accompanying table shows a portion of P E ratios for firms. b Calculate the value of the test statistic and the pvalue.
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