Personal Finance: Turning Money into Wealth (7th Edition) (Prentice Hall Series in Finance)
7th Edition
ISBN: 9780133856439
Author: Arthur J. Keown
Publisher: PEARSON
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Chapter 12, Problem 2DC2
Summary Introduction
To determine:
Price/earnings ratio and to classify it as a growth or value stock.
Introduction:
Price earnings ratio is the connection between the present market price of company’s stock and its profit per share.
Growth stock is one which normally does not distribute dividend among shareholders rather it prefers to reinvest their net income in capital projects thus increasing the wealth of shareholders.
Value stock is one which is being traded on the stock market at a price lower than the performance of the company and often provides huge profits to long term investments.
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Chapter 12 Solutions
Personal Finance: Turning Money into Wealth (7th Edition) (Prentice Hall Series in Finance)
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