Question

g Is it possible for a company to exhibit a negative EPS and thus a negative P/E ratio? No Yes Which of the following statements is true about market value ratios? High P/E ratios could mean that the company has a great deal of uncertainty in its future earnings. Low P/E ratios could mean that the company has a great deal of uncertainty in its future earnings.

Answer 1

a) Yes

b) High P/E ratios could mean that the company has a great deal of uncertainty in its future earnings

Step-by-step explanation:

A) Yes, a company's shares can actually exhibit a negative P/E ratio, so it's not impossible, not in the least.

B) High P/E ratios could mean that the company has a great deal of uncertainty in its future earnings because when firms have great or high P/E ratios, they are usually examined to be properties of germination. P/E ratio is calculated to be the value of the share in any contemporary time as it tends to the profits that particular company have listed as it's financial term, oftentimes, they are usually on a per-share basis.