BUSINESS ADMINISTRATION
BUSINESS MATHEMATICS
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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P4.00
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P50.00
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P8.00
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P12.00
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Detailed explanation-1: -Market Price per Share = Current market price of the share. Book Value per Share = (Total assets-intangible assets-total liabilities) ÷ number of outstanding shares1.
Detailed explanation-2: -To estimate the market price for the date, look in the company’s annual report for the accounting period for the P/E ratio and earnings per share. Multiply the two figures. For instance, if the P/E ratio is 20 and the company reported EPS of $7.50, the estimated market price works out to $150 per share.
Detailed explanation-3: -Book Value per Share: It is calculated by dividing the company’s equity by the total number of outstanding shares. Market Value per Share: It is calculated by considering the market value of a company divided by the total number of outstanding shares.
Detailed explanation-4: -Once a company goes public and its shares start trading on a stock exchange, its share price is determined by supply and demand in the market. If there is a high demand for its shares, the price will increase. If the company’s future growth potential looks dubious, sellers of the stock can drive down its price.