- CFA Exams
- CFA Level I Exam
- Topic 9. Portfolio Management
- Learning Module 37. Economics and Investment Markets
- Subject 5. Equities and the Equity Risk Premium
CFA Practice Question
Which factor could explain a high P/E?
B. Less uncertainty about future inflation
C. A fall in the expectation of future real earnings growth
A. A rise in inflation expectations
B. Less uncertainty about future inflation
C. A fall in the expectation of future real earnings growth
Correct Answer: B
The other two factors could help explain a low P/E.
User Contributed Comments 0
You need to log in first to add your comment.