- 3 Marks
CR – Aug 2022 – L3 – Q4a – Business Valuation
This question requires identifying three factors that influence the value of the Price-Earnings (P/E) ratio in business valuation.
Question
When acquiring an unquoted company in a takeover bid, the final price will be agreed by negotiation. However, the crucial role of the price-earnings ratio in arriving at the final price cannot be overemphasized.
Required:
State THREE (3) factors that are likely to influence the value of the price-earnings ratio.
Find Related Questions by Tags, levels, etc.
- Tags: Investment decisions, Market Sentiment, Price-Earnings ratio, Valuation
- Level: Level 3
- Topic: Business valuations
- Series: AUG 2022