n NISM Certifications
XV NISM Series XV
Medium

Which of these is the formula to calculate Earnings Yield?

Practice question from NISM XV Mock Test 5 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Current Stock Price + Earnings Per Share

  2. B

    Current Stock Price ÷ Earnings Per Share

  3. C

    Earnings Per Share × Current Stock Price

  4. Earnings Per Share ÷ Current Stock Price

    Correct answer

Why this is the answer

Earnings Yield is the inverse of the P/E ratio and measures earnings relative to price.

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