The Debt to Total Assets Ratio Is Computed by Dividing

question 132

Multiple Choice

The debt to total assets ratio is computed by dividing

• A) long-term liabilities by total assets.
• B) total debt by total assets.
• C) total assets by total debt.
• D) total assets by long-term liabilities.

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Definitions:

Prices

The cash amount predicted, necessary, or offered as compensation for something.

Real Interest Rate

The interest rate that has been adjusted to remove the effects of inflation, representing the true cost of borrowing and the true yield on investing.

Nominal Interest Rate

The interest rate before adjustment for inflation; the stated rate on a loan or investment.

Rate of Inflation

The uplift in the general cost of products and services in an economy over an allotted period.