Answer:
The right answer is "56 shares".
Explanation:
According to the question,
Earning per share is:
= [tex]\frac{3000}{300}[/tex]
= $[tex]10[/tex]
PE ratio will be:
= [tex]\frac{1}{ke}[/tex]
= [tex]\frac{1}{15}[/tex]
= [tex]6.67[/tex]
Market price at every share will be:
= [tex]PE \ ratio\times EPS[/tex]
= [tex]6.67\times 10[/tex]
= [tex]66.7 \ Per \ share[/tex] ($)
Now,
The number of purchased shares will be:
= [tex]\frac{borrow}{market \ price \ per \ share}[/tex]
= [tex]\frac{3750}{66.7}[/tex]
= [tex]56.22[/tex]
i.e.,
= [tex]56 \ shares[/tex]
