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OpenStudy (anonymous):

what is a price earnings ratio? how is it calculated?

OpenStudy (anonymous):

A P/E ratio is a good indication of how the market is valuing the earnings of a company and is calculated as ($hare price)/(Earnings per share). A high P/E ratio means that the market is willing to pay more for each dollar of company earnings, whereas a low P/E ratio means the market demands more earnings for each dollar.

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