Use the Following Information to Answer the Question(s)below

question 40

Multiple Choice

Use the following information to answer the question(s) below.
Wyatt Oil has assets with a market value of $600 million,$70 million of which are cash.It has debt of $250 million,and 20 million shares outstanding.Assume perfect capital markets.
-If Wyatt Oil distributes the $70 million as a dividend,then its debt-to-equity ratio after the dividend will be closest to:

• A)0.7.
• B)0.9.
• C)1.0.
• D)1.1.

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Definitions:

Intensity

The degree or strength of a quality, condition, or feeling.

Distributive Justice

The perceived fairness in the allocation of resources or rewards within a society or group.

Golden Rule

A moral imperative to treat others as one would wish to be treated oneself, often cited across various cultures and religions.

Utilitarian

An ethical philosophy that advocates for actions to be made based on their outcomes, specifically aiming to maximize overall happiness and reduce suffering.