equity

问题如下：

7. Based on Exhibit 2, the justified price-to-book ratio for TTCI is closest to:

选项：

A.

1.79.

B.

2.27.

C.

2.79.

解释：

A is correct.

The justified price-to-book ratio is calculated as

$\frac PB=1+\left(\frac{ROE-r}{r-g}\right)=1+\left(\frac{0.12-0.087}{0.087-0.045}\right)$=1.79

$\begin{array}{l}\frac{P}{B}=1+\frac{ROE-r}{r-g}\\ =1+\frac{01.2-0.087}{0.087-0.045}\text{=1}\text{.79}\\ \end{array}$