What Would Be the Maximum Limit for an Individual's Debt-To-Equity

question 94

Multiple Choice

What would be the maximum limit for an individual's debt-to-equity ratio,excluding the home mortgage?

• A)0.50
• B)0.33
• C)1.00
• D)2.00
• E)2.25

---

Definitions:

Net Cash Inflows

The total amount of money received from operations, investments, and financing activities, minus the amount of money spent.

Operating Income

The profit realized from a company's everyday core business operations, excluding deductions of interest and taxes.

Cash Payback Period

The duration needed for an investment to generate cash flows sufficient to recover the initial cost of the investment.

Net Cash Inflow

Net cash inflow refers to the difference between the cash inflows and outflows within a given period, indicating the net change in cash and cash equivalents resulting from a company's activities.