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A stock has a usual P/E ratio of 10, and its current earnings per share is $1.50. Based on its usual P/E ratio, which is

  1. A stock has a usual P/E ratio of 10, and its current earnings per share is $1.50.

    • Based on its usual P/E ratio, which is the stocks estimated value?

    • The stocks current market prices is $19.50. Is it a good time to buy or sell the stock. Explain.

    • The stock was purchased last year for $15, and dividends of $0.75 were paid this year. What is its investment return for the year?

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