Calculate the missing value

Question

Calculate the missing value. (Round your answer to the nearest whole number.)

Company Earnings per share Closing price per share Price-earnings ratio
BellSouth $ 2.80 $ 32.30

 

Answer 1

The price-earnings ratio is exactly what it sounds like - a fraction of price to earnings.
At a price of 32.3 and earnings of 2.8, the P/E ratio is 32.3/2.8, which is about 12.