Question: thank you very much! Which statement is NOT CORRECT if we use DDM to explain the P/E ratio? O P/E will tend to be higher

thank you very much!

Which statement is NOT CORRECT if we use DDM to explain the P/E ratio? O P/E will tend to be higher when ROE is higher. O P/E will tend to be higher when the dividend payout ratio is lower (when ROEROR) O P/E will tend to be higher when the beta is lower. O P/E will tend to be higher when the constant growth rate is higher

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Throughout this course, you will prepare a comprehensive financial analysis and proposal (excluding tables, figures, and addenda) that will demonstrate your understanding of key financial concepts,...

1. Make a business strategy plan 2. Comment more on the sustainability of profits generated by the company's strategy. (More based on numbers in financial analysis, not general strategy statements on...

1. True or False: In ratio analysis, a single value has little meaning. Therefore analysts use trend and comparative analyses to help "interpret the numbers." 2. True or False: It is always quite...

Q1 The following forecast is made for Kallang Ltd: 2021 $ 2022 $ 7.20 0.50 2023 $ 8.20 0.50 6.00 EPS (Earings per Share) DPS (Dividends per Share) 0.50 The ROCE (Return on Common Equity) for 2021 is...

An organizational investment analyst is to look at how well a company is doing financially. Different metrics, such as return on assets (ROA), price to earnings (PE) ratio, return on equity (ROE),...

Which of the following statement is correct? Replacement cost is not a measure of firm value The P/E ratio is higher, if ROE is higher A company with a lower plowback ratio tends to have a higher...

Need question E15-23 within this pdf document answered please. 2015 Cambridge Business Publishers | For the Personal Use of Amanda Rosena. Explain company valuation using market multiples based on...

Need question E15-28 within this pdf document answered please. 2015 Cambridge Business Publishers | For the Personal Use of Amanda Rosena. Explain company valuation using market multiples based on...

Need question E15-24 within this pdf document answered please. 2015 Cambridge Business Publishers | For the Personal Use of Amanda Rosena. Explain company valuation using market multiples based on...

Q1-Explain how the EBIT Chart works (inputs determining the outputs-the two lines on the chart Case Leahy Bread Company (LBC) in Cohen Finance Workbook, page 111( a 'caselette') SEE THE IS/BS MODEL &...

Complete the truth table for the given statements and then determine if the two statements are logically equivalent. ~PV~ q and p ~ q P T T F 9 T F T F ~P F LL F T T Truth Table ~ q F T F T ~pv ~q P...

Resolve a force of 10 N into two forces perpendicular to each other so that one component makes an angle of 60 with the 10 N force.

QUESTION 2 5 The investment required for the project profitability index should: be reduced by the amount of any salvage recovered from the sale of both the old and new equ be reduced by the ainount...

AbnerCorporation's bonds mature in22 years and pay11 percent interest annually. If you purchase the bonds for$1,200, what is your yield tomaturity? Your yield to maturity on the Abner bonds...

In Example 3.4 we considered the course of the Dow Jones Industrial Average over 2 days and defined four basic outcomes: O1: The Dow Jones average rises on both days. O2: The Dow Jones average rises...

3.7 Florin Frenti operates a small, used car lot that has three Mercedes (M1, M2, M3) and two Toyotas (T1, T2). Two customers, Cezara and Anda, come to his lot, and each selects a car. The customers...

3.6 Consider Example 3.4, with the following four basic outcomes for the Dow Jones Industrial Average over two consecutive days: O1: The Dow Jones average rises on both days. O2: The Dow Jones...