What is the current price of a share of stock for a firm with $5 million in balance-sheet equity,500,000 shares of stock outstanding,and a price/book value ratio of 4?
A) $2.50
B) $10.00
C) $20.00
D) $40.00

Name: What is the current price of a share of stock for a firm with $5 million in balance-sheet equity,500,000 shares of stock outstanding,and a price/book value ratio of 4? A) $2.50 B) $10.00 C) $20.00 D) $40.00
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Question

Quizplus · Accepted Answer

Price = 4 × ($5,000,000/500,000) = $40

What Is the Current Price of a Share of Stock