- CFA Exams
- CFA Level I Exam
- Topic 5. Equity Valuation
- Learning Module 23. Market-Based Valuation: Price and Enterprise Value Multiples
- Subject 12. Valuation Indicators: Issues in Practice
CFA Practice Question
When averaging P/E multiples of a group of stocks, the harmonic mean is sometime used to reduce the impact of
B. small outliers only.
C. both large and small outliers.
A. large outliers only.
B. small outliers only.
C. both large and small outliers.
Correct Answer: A
The small outliers are bounded by zero on the downside.
User Contributed Comments 4
| User | Comment |
|---|---|
| daverco | Outliners? Interesting. |
| alejandroc | Never heard it before. |
| ABYCAPRI | Perhaps Outliers!? |
| thebkr777 | It was after all only $100 |