Price-earnings ratio

1. What is meant by the price-earnings ratio?

2. Does the dividend payout ratio tell you anything different from the information included in the computation for dividends per share?

3. Why do analysts use ratios to evaluate company performance?

1. What is the difference between return on assets and return on owners’ equity?

2. What is meant by earnings per share?

3. How is earnings per share different from diluted earnings per share?

Solution: