Higher Debt Utilization Ratios Will Always Increase a Firm's Return

question 52

True/False

Higher debt utilization ratios will always increase a firm's return on equity given a positive return on assets.

---

Definitions:

LiI

Lithium iodide, a chemical compound made of lithium and iodine, used notably in batteries and pharmaceuticals.

Electrolyte

A substance that produces an electrically conducting solution when dissolved in water, important in many biological processes.

Electrolyte

A compound that forms an electrically conductive solution upon being dissolved in a polar solvent, like water.

NaI

Sodium iodide, an ionic compound often used in organic synthesis and as a supplement.