A firm's current stock price divided by its annual revenue per share is referred to as the:

Question

Quizplus · Accepted Answer

The term used to describe a firm's current stock price divided by its annual revenue per share is the price-sales ratio. This ratio is a measure of how much investors are willing to pay for each dollar of sales generated by the company. It is often used by investors to assess a company's valuation relative to its sales performance. The other answer choices (A) price-earnings ratio, (B) price-book ratio, (C) price-income ratio, and (E) price-cash flow ratio all use different financial metrics in their calculations.

A Firm's Current Stock Price Divided by Its Annual Revenue