The Debt-To-Equity Ratio Measures the Amount of Financing Provided by Creditors

question 41

Multiple Choice

The debt-to-equity ratio measures the amount of financing provided by creditors relative to

• A)equity earned from operations.
• B)equity provided by retained earnings.
• C)equity provided by owners.
• D)equity earned through dividends.

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Definitions:

Output Increases

A rise in the amount of goods or services produced by an entity.

Average Costs

The total cost of production divided by the number of goods produced; it decreases as production increases.

Average Costs

The average expense associated with producing a good or service, typically calculated by dividing the total costs by the quantity of goods or services produced.

Output Increases

A situation where the production level of goods or services in an economy or firm rises.