One hundred million shares of stock have been outstanding for the period. Prospecs share price in 20X7, 20X8, and 20X9 was $39.27, $26.10, and $11.55. Calculate the firm's Earnings Per Share (EPS), and its Price Earnings Ratio (P/E). What's happening to the P/E? To what things are investors likely to be reacting? How would a slowdown in personal computer sales affect your reasoning?

	20X7	20X8	20X8
Sales	$1,578	$2,106	$3,265
COGS	631	906	1,502
Gross Margin	$ 947	$1,200	$1,763
Expenses
Marketing	$316	$495	$882
R & D	158	211	327
Admin.	126	179	294
Total Expenses	$ 600	$ 885	$1,503
EBIT	$347	$315	$260
Interest	63	95	143
EBT	$284	$220	$117
Tax	97	75	40
EAT	$187	$145	$ 77

	20X7	20X8	20X9
ASSETS
Cash	$ 30	$ 40	$ 62
Accounts Receivable	175	351	590
Inventory	90	151	300
Current Assets	$ 295	$ 542	$ 952
Fixed Assets
Gross	$1,565	$2,373	$2,718
Accum. Depreciation	(610)	(860)	(1,135)
Net	$ 955	$1,513	$1,583
Total Assets	$1,250	$2,055	$2,535
LIABILITIES
Accounts Payable	$56	$81	$134
Accruals	15	20	30
Current Liabilities	$71	$101	$164
Capital
Long-Term Debt	$630	$1,260	$1,600
Equity	549	694	771
Total Liability & Equity	$1,250	$2,055	$2,535