What the intrinsic value of the share in question is

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Reference no: EM132659431

Problem 1: The current price of a share is $3.00. Its current earnings are 20 cents per share. Earnings are expected to grow indefinitely at 5% pa. The PE ratio is:

a. 15.00

b. 14.29

c. 15.75

d. 14.75

e. None of the above

Problem 2: Given and EPS of $1.50 and a PE ratio of $8, this implies a share value of

a. 59.50

b. 56.50

c. $12

d. $1.50 O

e. None of the above

Problem 3: Given a current dividend of $0.5, a constant growth rate of 5% and a required return of 10%, the intrinsic value of the share in question is:

a. $11

b. $12

c. $10.50

d. $11.50

e. None of the above

Reference no: EM132659431

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