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    Question

    The 'Price/Earnings (P/E) Ratio' is calculated

    as:
    A Market Price per Share / Earnings per Share (EPS) Correct Answer Incorrect Answer
    B Earnings per Share (EPS) / Market Price per Share Correct Answer Incorrect Answer
    C Dividend per Share / Market Price per Share Correct Answer Incorrect Answer
    D Market Price per Share / Book Value per Share Correct Answer Incorrect Answer

    Solution

    The P/E Ratio is a valuation metric that measures a company's current share price relative to its per-share earnings. It indicates how much investors are willing to pay per rupee of earnings. A higher P/E could mean the market expects future growth.

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