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Monday, August 3, 2009

PE Ratio

PE Ratio is Price Earning Ratio.To calculate PE Ratio divide the market price of a share by EPS.For example EPS is Rs 9/share and the share price is Rs 108.
PE Ratio=market price of share/EPS
=108/9
=12
This means that the share price is 12 times to its earnings.PE Ratio differs from country to country and economy to economy..

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