A. The P/E ratio is measured as the market price of the share divided by diluted earnings per share (DEPS). The market price is $108 and DEPS is $24. This gives a P/E ratio of 4.5 ($108 ÷ $24).
B. The P/E ratio is measured as the market price of the share divided by diluted earnings per share (DEPS). This answer uses basic earnings per share (BEPS) instead of diluted earnings per share.
C. The P/E ratio is measured as the market price of the share divided by diluted earnings per share (DEPS). This answer uses dividends paid rather than diluted earnings per share.
D. The P/E ratio is measured as the market price of the share divided by diluted earnings per share (DEPS). This answer uses the par value of the share instead of the diluted earnings per share.
