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A Firm Had Earnings Per Share of $3

Question 1

Multiple Choice

A firm had earnings per share of $3.25 for the year.The book value per share at the beginning of the year was $13.The firm paid out $.975 in dividends per share at the end of the year.If the rate of return on book value remains constant from year to year,what will the earnings per share be for the following year?


A) $7.50
B) $3.82
C) $4.23
D) $5.53
E) $3.25

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