11. The following about the price earnings ratio (P/E) is/are correct except: (2 marks) a....
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Accounting
11. The following about the price earnings ratio (P/E) is/are correct except: (2 marks) a. It is computed by multiplying the market price of the share by its earnings per share. b. PE ratio is used to discuss the investment possibility of a given enterprise C. The greater the P/E ratio, the better the perception of investors regarding the future growth of the firm. d. If a company's P/E ratio drops steadily this indicates that investors are confident of the firm's growth potential. 12. Activity ratios measure the following Drofitability of shares (1 mark)
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