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Which ratio is used in the comparable multiples method?             Price earnings ratio             Quick ratio...

Which ratio is used in the comparable multiples method?

            Price earnings ratio

            Quick ratio

            Current ratio

            Debt-to-equity ratio

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Answer #1
Solution:
Price earnings ratio
Working Notes:
Comparable multiples method is used mainly for valuation of unlisted company , in which EPS of unlisted company is multiplied to the Price earnings ratio of best Comparable available to the company which is listed and whose data is easily available .
So, Quick ratio, Current ratio & Debt-to-Equity ratio , are not used for valuation under Comparable multiples method , they are just ratio , of liquidity & gearing ratio
Please feel free to ask if anything about above solution in comment section of the question.
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