At year end, tangshan china company balance sheet showed total assets of $60 million, total liabilities (including preferred stock) of $45 million, and 1,000,000 shares of common stock outstanding. next year, tangshan is projecting that it will have net income of $1.5 million. if the average p/e multiple in tangshan's industry is 15, what should be the price of tangshan's stock?

Earnings per share

= Net income - Preferred dividend

  No of common stocks outstanding

= $1,500,000 - 0

   1,000,000 shares

= $1.50 per share

P/E ratio = Market price per share

                 Earnings per share

15   = Market price per share

              $1.50

Market price per share = 15 x $1.50

                                      = $22.50

Explanation:

In this question, there is need to calculate earnings per share by dividing net income by number of common stocks outstanding. Thereafter, we will apply P/E ratio formula, where P/E ratio and earnings per share are known. We will make market price per share the subject of the formula.

false. insurance companies differ from the pricing to the different deals you can get.

answer; someone must cover the cost associated with the provision of scarce goods in both sectors;