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A company reinvests 60 percent of its earnings in the firm. Next years dividend is projected to be $2.50 per share. The discount rate is
A company reinvests 60 percent of its earnings in the firm. Next years dividend is projected to be $2.50 per share. The discount rate is 15 percent and the grown rate is 10 percent. What is the price-earnings ratio?
A) 6.7
B) 8.0
C) 12.0
D) 16.7
E) 20.0
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