A stock that is currently experiencing low demand in the market would likely have a:
A) high P/E ratio.
B) low P/E ratio.
C) high earnings multiple.
D) low required rate of return.

Question

Quizplus · Accepted Answer

A stock experiencing low demand in the market typically has a low price relative to its earnings, resulting in a low P/E (Price-to-Earnings) ratio. This is because the stock's price is depressed due to the low demand, but its earnings may remain constant, leading to a lower ratio.

A Stock That Is Currently Experiencing Low Demand in the Market