An Increase in the Debt Ratio May Be Associated with an Increase

question 47

True/False

An increase in the debt ratio may be associated with an increase in risk.

---

Definitions:

Annuity Table

A tool used to determine the present value of an annuity by providing factors to calculate payments or values at various rates and periods.

Future Value

The value of a current asset at a future date based on an assumed rate of growth.

Discount Periods

The time frame in which a discount is available for early payment of an invoice or debt.

Present Value

The current value of a future sum of money or stream of cash flows, given a specified rate of return.