Suppose you own a savings account that earned $10 over the past year. Your only transaction in the account has been to withdraw $3 on the last day of this 12-month period. The account bears an interest rate of 4 percent per year.
a) what is the value of the account after the $3 withdrawal?
b) what is the trailing P/E and forward P/E for this account
This solution assists with determining the value, trailing P/E and forward P/E for an account.