1. What does a price earnings (PE) ratio of 18 mean?
a For each $100 paid, you can expect $18 in annual dividends.
b For each $100 paid, you can expect $18 of annual earnings.
c For each $1 of annual earnings, you must pay $18 for the stock.
d For each $1 of annual dividends, you must pay $18 for the stock.
2. What price do you pay for a $5,000 Treasury bond based on a quote of 118:14?
a $5,118.14
b $5,907.00
c $5,922.00
d $5,921.88