Book to Market Ratio

The following information relates to two companies, designated Company A and Company B. One of the companies is a traditional steel manufacturer. The other is a successful Internet retailer. Using the following information, identify which is which, and explain your answer.

Reported

 

Total Market Value

Stockholders’ Equity

 

of Equity

Company A                                

$10,000

$75,000

Company B                                

10,000

8,000