Suppose a company retains 60 percent of its earnings for reinvesting in profitable projects. Its return on
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Suppose a company retains 60 percent of its earnings for reinvesting in profitable projects. Its return on equity (ROE) is 12 percent. If the required rate of return on the company's share is 15 percent, what is the price-earnings ratio of this company?
Related Book For
Introduction to Management Accounting
ISBN: 978-0133058789
16th edition
Authors: Charles Horngren, Gary Sundem, Jeff Schatzberg, Dave Burgsta
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