A ________ ratio is commonly used to assess owners' appraisal of the share value.
A) debt
B) price/earnings
C) return on equity
D) return on total assets

Question

Quizplus · Accepted Answer

The price/earnings (P/E) ratio is commonly used to assess owners' appraisal of the share value. This is because it indicates the price investors are willing to pay per dollar of company earnings. A higher P/E ratio suggests that investors are optimistic about the company's future growth prospects and are willing to pay more for its earnings.

A ________ Ratio Is Commonly Used to Assess Owners' Appraisal