In mid-2006, after a year of sudden increases in oil prices, major oil companies were selling at unusually low price/earnings (P/E) ratios. For example, The Wall Street Journal published in October P/E ratios of 5 for ConocoPhillips and 6 for Marathon Oil. Remember that these companies declared P/E ratios equal to the current price divided by the EPS of the previous year. a) What factors explain the low P/E ratios? Hint: what would happen if investors Would you have anticipated a drop in future oil prices? b) Recheck The Wall Street Journal or another source of stock market data. How much have the P/E ratios of these companies changed since October 2006? How do you interpret or explain these changes?