A certain pharmaceutical company reported earnings of $3.3 billion this year. The
earnings have been growing at a constant rate of about 3% a year, and the firm has a
price/earnings ratio of 26. By how much would its price increase if it could increase its
perpetual growth rate to 5% a year?

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The Answer of A certain pharmaceutical company reported earnings of $3.3 billion this year. The
earnings have been growing at a constant rate of about 3% a year, and the firm has a
price/earnings ratio of 26. By how much would its price increase if it could increase its
perpetual growth rate to 5% a year?

A Certain Pharmaceutical Company Reported Earnings of $3