Firm X and Firm Y both reported EPS of $1 per share in their most recent income statement. Firm X has a P/E ratio of 30 while Firm Y has a P/E ratio of 10. What is the likely reason for the difference in P/E ratios?

Select one:

a.Higher expected earnings growth rate for Firm X

b.Higher retained earnings for Firm X

c.Lower profit margins for Firm Y

d.Higher asset turnover ratio for Firm X