Suppose That the Average P/E Multiple in the Oil Industry

Multiple Choice

Suppose that the average P/E multiple in the oil industry is 16. Shell Oil is expected to have an EPS of $4.50 in the coming year. The intrinsic value of Shell Oil stock should be

A) $28.12.
B) $35.55.
C) $63.00.
D) $72.00.
E) None of the options are correct.