The following comparative net income and earnings per share data are provided for Research in Motion Ltd., developer of the BlackBerry® wireless handheld device, for three recent fiscal years:

The stock market prices at the end of each of the three fiscal years were as follows:
March 1, 2003 .........$ 6.65
February 28, 2004 .......49.45
February 28, 2005 .......66.11
a. Determine the price-earnings ratio for Research in Motion for each of the three fiscal years, using basic earnings per share and the ending stock market price. Round to two decimal places.
b. What conclusions can you reach by considering the price-earnings ratio?
c. Why is the diluted earnings per share less than the basic earnings pershare?

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Mar. 1 2003 Feb. 28, Feb. 28, 2004 Year ended Net income Basic earnings per share Diluted earnings per share 2005 $51,829 1488 $213,387 1.14 1.09 (148,857) 0.65 0.62 1.92)