What is the current pe ratio for each company

Reference no: EM13259446

Consider Pacific Energy Company and U.S. Bluechips, Inc., both of which reported earnings of $755,000. Without new projects, both firms will continue to generate earnings of $755,000 in perpetuity. Assume that all earnings are paid as dividends and that both firms require a 19 percent rate of return.

Required:

(a) What is the current PE ratio for each company?

Reference no: EM13259446

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