Company B and Company U are in the same line of business. Company B is based in

Question:

Company B and Company U are in the same line of business. Company B is based in Brazil, where inflation during the past few years has averaged about 9 percent. Company U is based in the United States, where the inflation during the past few years has averaged about 2.5 percent. The real rate of return required by global investors for investing in such as B and U is 8 percent. Neither B nor U has any real growth in earnings, and both of them can pass only 60 percent of inflation through their earnings. What should be the P/E of the two companies? What can you say based on a comparison of the P/E for the two companies? Stocks
Stocks or shares are generally equity instruments that provide the largest source of raising funds in any public or private listed company's. The instruments are issued on a stock exchange from where a large number of general public who are willing...