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Richmond Rent - A - Car is about to go public. The investment banking firm of Tinkers, Evers & Chance is attempting to price the

Richmond Rent-A-Car is about to go public. The investment banking firm of Tinkers, Evers & Chance is attempting to price the issue. The car rental industry generally trades at a 17 percent discount below the P/E ratio on the Standard & Poor's 500 Stock Index. Assume that the index currently has a P/E ratio of 30. The firm can be compared to the car rental industry as follows:
\table[[,Richmond,Car Rental Industry],[Growth rate in earnings per share,12%,10%
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