Chapter 12 - Slides 19-35 ‑ Stock Indexes; Numeric MeasuresHow can we say that stock investments have returned 8% to 10% over the long term? In this session, we discuss the various stock indexes that are used to measure the success (or lack thereof) of stock investing. We also learn how to compute some of the most popular and fundamental numerical measures of stock investments, including earnings per share, dividend yield, book value, market capitalization, and price-to-earnings ratio. We end by examining these numerical measures of some very well-known corporations.
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