Suppose That the Financial Ratios of a Potential Borrowing Firm

question 112

Multiple Choice

Suppose that the financial ratios of a potential borrowing firm took the following values: X₁ = Net working capital/Total assets = 0.15, X₂ = Retained earnings/Total assets = 0.10, X₃ = Earnings before interest and taxes/Total assets = 0.15, X₄ = Market value of equity/Book value of long-term debt = 0.40, X₅ = Sales/Total assets ratio = 0.8. Calculate the Altman's Z-score for this firm.

• A) 9.10
• B) 1.60
• C) 0.371
• D) 1.855

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A behavior reinforcement strategy in which an undesirable or discomforting stimulus is removed after the display of a behavioral response.

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