A Company Has a Debt to Assets Ratio of

question 36

Multiple Choice

A company has a debt to assets ratio of .45 and a return on equity ratio of 10%.If the company then issues common stock,which of the following is a true statement?

• A)The debt to assets ratio will decrease and the return on equity ratio will decrease.
• B)The debt to assets ratio will increase and the return on equity ratio will increase.
• C)The debt to assets ratio will not change and the return on equity ratio will not change.
• D)The debt to assets ratio will decrease and the return on equity ratio will increase.

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Definitions:

Teratogens

Agents or factors that cause malformation of an embryo or fetus.

Drugs

Substances used to diagnose, treat, cure, or prevent diseases or to enhance physical or mental well-being.

Viruses

Microscopic infectious agents that can only replicate inside the living cells of an organism, responsible for various diseases.

Malnutrition

Health complications caused by a dietary imbalance, where there is an excess or deficiency of vital nutrients.