What is the market price of a share of stock for a firm that pays dividends of $1.20 per share, has a P/E of 14, and a dividend payout ratio of 0.4?
market price of a share
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a
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Dividend per share
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mce_markernbsp; 1.20
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b
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Dividend payout ratio
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0.4
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c
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P/E
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14
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d
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Earning per share (a/b)
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mce_markernbsp; 3.00
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e
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Market Price (d x c)
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mce_markernbsp; 42.00
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