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On the 1st May 2020, Amazon shares traded on a priceearnings multiple of 109.20 and on the same day General Motors traded on a P/E
On the 1st May 2020, Amazon shares traded on a priceearnings multiple of 109.20 and on the same day General Motors traded on a P/E of 4.57. The P/E for the S&P 500 (the main US stock index) was 20.3 on the same day. Explain to person in the street why the figures are so different and give a justification for these values. Choose one major weakness of the P/E ratio and discuss it.
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