The Debt Ratio Is Used To

question 37

Multiple Choice

The debt ratio is used to:

• A) Is used only by banks when a business applies for a loan.
• B) Describe the risk associated with a company's debts and is used only by banks when a business applies for a loan.
• C) Measure the relationship of equity to debt.
• D) Describe the risk associated with a company's debts.
• E) Measure the relationship of equity to debt and describe the risk associated with a company's debts.

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Definitions:

Maxim

A concise statement expressing a general truth or rule of conduct.

Rule

A prescribed guideline for conduct or action established by an authority, which governs behavior within specific contexts.

Morality

Norms that identify the difference between laudable and blameworthy habits.

Summun Bonum

A Latin term meaning the highest or supreme good, often used in ethical, philosophical, and metaphysical contexts to denote the ultimate importance or aim.