The fiNancial Ratio Measured as EBIT Divided by Interest Expense

question 369

Multiple Choice

The financial ratio measured as EBIT divided by interest expense is the __________.

• A) Cash coverage ratio.
• B) Debt-equity ratio.
• C) Times interest earned ratio.
• D) Gross margin.
• E) Total debt ratio.

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Definitions:

Aggregate Demand Curve

Describes the buying behavior of a group of consumers. We add up all the individual demand curves to get an aggregate demand curve (the relationship between the price and the number of purchases made by a group of consumers).

Total Demand

Represents the entire quantity of a certain product or service that consumers in a market are willing and able to purchase at a given price level.

Market

A physical or virtual space where buyers and sellers interact to exchange goods, services, or information.

Highest Willingness to Pay

The maximum amount an individual is prepared to spend to obtain a good, service, or outcome, reflecting the perceived value.