n NISM Certifications
XV NISM Series XV
Medium

A company declares a dividend of 30% on shares with a face value of Rs. 5. The dividend payout ratio is 40%, and the current market price of the share is Rs. 60. Calculate the Price-to-Earnings (P/E) ratio and the Earnings Yield.

Practice question from NISM XV Mock Test 6 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    P/E = 24, Earnings Yield = 9.50%

  2. B

    P/E = 20, Earnings Yield = 6.88%

  3. P/E = 16, Earnings Yield = 6.25%

    Correct answer

  4. D

    P/E = 14, Earnings Yield = 8.56%

A full explanation for this question is being written. In the meantime, the correct answer is highlighted above.

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