If Dawson Corporation's common stock has a price-earnings ratio of eight,the market price per share (to the nearest dollar)would be:
A) $56.
B) $68.
C) $72.
D) $125.

Question

Quizplus · Accepted Answer

The price-earnings ratio is calculated as the market price per share divided by the earnings per share. If the P/E ratio is 8, and assuming the earnings per share is $7 (since $56 divided by 8 equals $7), the market price per share would be $56.

If Dawson Corporation's Common Stock Has a Price-Earnings Ratio of Eight,the