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Using P/E Ratio to Calculate EPS

CORPFN-UOJEGL

An analyst has determined that the intrinsic value of Hotstock Inc. is \$80 per share using the relative valuation approach.

If the typical forward P/E ratio in the computer industry is 22, then it would be reasonable to assume that the expected EPS of Hotstock Inc. in the coming year is

A

$0.28

B

$3.64

C

$4.44

D

$22.50