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Question 6 (15 points): The following sketch shows the ratio of Earnings Per Share to the Book Value Per Share of Common Stock. EPS/Book val.
Question 6 (15 points): The following sketch shows the ratio of Earnings Per Share to the Book Value Per Share of Common Stock. EPS/Book val. per share of common stock 0.16 0.15 0.14 0.13 0.12 0.11 0.1 0.09 0.08 0.07 0.06 0.05 0.04 0.03 0.02 0.01 0 2015 2017 2016 2018 a. If the price/earnings (P/E) ratio is 15 in 2016, what is the Market /book (M/B) ratio? b. If the book value per share of common stock is the same all over the four years, which year presents the highest EPS
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