Question
Given the same level ofrisk, select one of the following shares that is cheaper. ShareA: $0.10/ pershare, EPS=$0.05 ShareB: $100/pershare, EPS=$200 A. Share B is
Given the same level ofrisk, select one of the following shares that is cheaper.
ShareA: $0.10/ pershare, EPS=$0.05
ShareB: $100/pershare, EPS=$200
A.
Share B is cheaper as itsP/E ratio is lower
B.
Share A is cheaper as its price per share is much lower
C.
Unable to determine as not enough information is given
D.
They are equally cheap as the risk levels of two companies are the same
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Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
15th edition
1337671002, 978-1337395250
