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10 December, 09:25

You expect Whirlpool Corporation (WHR) to have earnings per share of $6.10 over the coming year. If Whirlpool stock is currently trading at $87.00 per share, then Whirlpool's P/E ratio is closest to:

A. 13.50

B. 17.00

C. 7.00

D. 14.25

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Answers (1)
  1. 10 December, 09:57
    0
    D. 14.25

    Explanation:

    Data provided as per the question below:-

    Marginal Propensity to Save = $87.00

    Earnings per share = $6.10

    The computation of price earning ratio is shown below-

    Price earning ratio = Marginal Propensity to Save : Earnings per share

    = $87.00 : $6.10

    = 14.25

    Therefore for computing, the we simply applied the above formula.
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