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Series 7: Investment Information & Recommendations
Series 7 practice questionmediumAnalysis and Valuation 511

A stock selling at $34 with earnings per share of $2 has a price-to-earnings ratio of:

  1. A17✓ Correct answer
  2. B2
  3. C19
  4. D15
Explanation

Why A17

The P/E ratio equals market price per share divided by earnings per share. $34 divided by $2 equals 17.

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