Traditionally, stock of financially sound companies with stable earnings usually have a price-earnings ratio of:

Question

Quizplus · Accepted Answer

The price-earnings ratio (P/E ratio) of financially sound companies with stable earnings is usually around 12. A P/E ratio of 12 means that investors are willing to pay $12 for each dollar of earnings. This ratio is considered reasonable and attractive for long-term investors looking for stable returns. Options A, C, and D are not the correct choices as they imply either extremely high or low P/E ratios, which are not typical for financially sound companies with stable earnings.

Traditionally, Stock of Financially Sound Companies with Stable Earnings Usually