The following table shows the Price-to-Earnings ratio for a Stereo equipment manufacturing company between 1998 and 2002. Determine the percentage change in the P/E ratios from 1998 to 1999.
A)15.07%
B)17.74%
C)20.72%
D)-17.74%
E)-15.07%

Question

The following table shows the Price-to-Earnings ratio for a Stereo equipment manufacturing company between 1998 and 2002.  Determine the percentage change in the P/E ratios from 1998 to 1999.
A)15.07% 
B)17.74% 
C)20.72% 
D)-17.74% 
E)-15.07%

Quizplus · Accepted Answer

To calculate the percentage change in P/E ratio from 1998 to 1999, we need to use the formula:

Percentage change = ((New value - Old value)/Old value) x 100

Here, the old value is the P/E ratio in 1998, which is 15.1, and the new value is the P/E ratio in 1999, which is 17.8.

Therefore, the percentage change = ((17.8 - 15.1)/15.1) x 100 = 17.74%

Hence, the correct answer is B, 17.74%.

The Following Table Shows the Price-To-Earnings Ratio for a Stereo