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Updated on: 07 May 2024, 08:26
Originally posted by Sajjad1994 on 16 Jul 2020, 07:00.
Last edited by Bunuel on 07 May 2024, 08:26, edited 4 times in total.
Last edited by Bunuel on 07 May 2024, 08:26, edited 4 times in total.
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The median P/E ratio for the alternative companies is at least 150% higher than the median P/E ratio for the conventional companies.: False
For market capitalization, adjusting each of the values to the median would require a greater percent change for the lowest-ranked company than for the highest-ranked company.: True
The average dividend yield would remain the same if the lowest reported dividend yield were 10% higher and the highest reported dividend yield were 10% lower.: False
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
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The table shows one quarter's stock market data for eight energy companies, five that specialize in alternative energy sources and three that utilize conventional energy sources. The columns represent, respectively: the name of the company, the company's market capitalization (Market Cap), the Price/Earnings ratio (P/E), the quarterly dividend yield (Div. Yield) and the quarterly price change as represented by a percentage (Price Change).
(Sort ↕ the table by clicking on the headers)
For each statement, indicate whether the statement is true or false, based on the information in the table.
2weds.jpg [ 118.6 KiB | Viewed 5347 times ]
| Name | Market Cap (Millions) | P/E | Div.Yield (%) | Price Change (%) | Type |
|---|---|---|---|---|---|
| Dino Power | 76.36 | 5.45 | 0.65 | 6.32 | Conventional |
| Eco Energy | 61.55 | 16.12 | 1.46 | -0.49 | Alternative |
| Hydro Solutions | 84.66 | 36.68 | 0.73 | 5.35 | Alternative |
| Nature’s Way | 54.68 | 11.31 | 2.19 | -4.62 | Alternative |
| Omni Coal | 64.38 | 22.13 | 1.95 | 5.59 | Conventional |
| Solely Solar | 21.22 | 34.76 | 2.93 | 3.89 | Alternative |
| True Blue Flame | 44.40 | 9.77 | 1.30 | -10.45 | Conventional |
| Wind Logic | 68.28 | 16.70 | 2.60 | 8.75 | Alternative |
For each statement, indicate whether the statement is true or false, based on the information in the table.
Attachment:
2weds.jpg [ 118.6 KiB | Viewed 5347 times ]
| True | False | |
| The median P/E ratio for the alternative companies is at least 150% higher than the median P/E ratio for the conventional companies. | ||
| For market capitalization, adjusting each of the values to the median would require a greater percent change for the lowest-ranked company than for the highest-ranked company. | ||
| The average dividend yield would remain the same if the lowest reported dividend yield were 10% higher and the highest reported dividend yield were 10% lower. |
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Official Answer
The median P/E ratio for the alternative companies is at least 150% higher than the median P/E ratio for the conventional companies.: False
For market capitalization, adjusting each of the values to the median would require a greater percent change for the lowest-ranked company than for the highest-ranked company.: True
The average dividend yield would remain the same if the lowest reported dividend yield were 10% higher and the highest reported dividend yield were 10% lower.: False
16 Jul 2020, 10:00
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1)Yes,P/E ratio for alternative energy sources=
11.31,16.12,16.7,34.76,36.68
So median is 16.7
While P/E ratio for conventional sources=5.44,9.77,22.13,so median is 9.77 now 150% of median of Conventional = 14.655 ,so it is higher
2)Yes, According to market cap the median is = (61.55+64.38)/2=62.965
So % change for lowest rank=(62.965-21.22)/21.22 =196%
While % change for highest rank = 25.62% decrement,so yes statement is true
3)No,Let the Sum of all yields = S
Now increasing the lowest by 10%= 0.65+0.065=.715
Decreasing the highest by 10% =2.93-.293=2.637
So previous sum of highest and lowest = 3.58
And new sum= 3.352,so the overall avg will decrease
Posted from my mobile device
11.31,16.12,16.7,34.76,36.68
So median is 16.7
While P/E ratio for conventional sources=5.44,9.77,22.13,so median is 9.77 now 150% of median of Conventional = 14.655 ,so it is higher
2)Yes, According to market cap the median is = (61.55+64.38)/2=62.965
So % change for lowest rank=(62.965-21.22)/21.22 =196%
While % change for highest rank = 25.62% decrement,so yes statement is true
3)No,Let the Sum of all yields = S
Now increasing the lowest by 10%= 0.65+0.065=.715
Decreasing the highest by 10% =2.93-.293=2.637
So previous sum of highest and lowest = 3.58
And new sum= 3.352,so the overall avg will decrease
Posted from my mobile device
24 Apr 2024, 07:29
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Apt0810
150 percent higher is wrong calculation if its 9.77 and If P/E for alternative has to be minimum 100 percent higher than it should be min 19.54 so your calculations is not correct for first question
