Using the chart below, compute the VRE ratio for each company and use it to determine which firm(s) might interest a value investor:

ROE Price EPS

Company A 15% $60 $3.00

Company B 20% $30 $2.00

Company C 12% $15 $1.50

1- Using the above information, calculate the VRE for Company A.

2- Using the above information, calculate the VRE for Company B.

3- Based on the VRE calculations, which firm(s) would be attractive to a value investor? Select one or more:

Company A

Company B

Company C

Both Company B and Company C.