A retrenching company with poor prospects would generally have:
A)high price-to-book ratio and high price-to-earnings ratio.
B)high price-to-book ratio and low price-to-earnings ratio.
C)low price-to-book ratio and high price-to-earnings ratio.
D)low price-to-book ratio and low price-to-earnings ratio.

Question

Quizplus · Accepted Answer

A retrenching company with poor prospects is likely to have a low price-to-book ratio because investors value its assets less, and a low price-to-earnings ratio due to skepticism about its future earnings growth, making its stock less attractive.

A Retrenching Company with Poor Prospects Would Generally Have