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A High Price Earnings Ratio (PE)gives What Interpretation

Question 61

Multiple Choice

A high price earnings ratio (PE) gives what interpretation?


A) The market expects earnings to fall in the future.
B) The market feels the firm's earnings are very high risk and are willing to pay a premium for them.
C) The market expects the earnings to rise in the future.
D) The firm is not paying a dividend.

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