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M and B both recently reported earnings of $800,000. Both also have 500,000 shares outstanding and a discount rate of 0.15. A. M has a

M and B both recently reported earnings of $800,000. Both also have 500,000 shares outstanding and a discount rate of 0.15. A. M has a new project will generate a net cash flow of $100,000 per annum in perpetuity. What is the companys current P/E ratio? B. B has a new project that will increase cash flows by $200,000 in the coming year. The earnings will grow at 10% per annum in perpetuity. What is the companys current P/E ratio

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