A Debt-To-Equity Ratio That Is Too High Normally Indicates the Company

question 48

True/False

A debt-to-equity ratio that is too high normally indicates the company has used up its borrowing capacity.

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Definitions:

Probability

A statistical measure that quantifies the likelihood of an event occurring, ranging from 0 (impossible) to 1 (certain).

Normal Model

A normal model is a statistical distribution that is symmetric, bell-shaped, and describes how different variables are distributed, assuming that most occurrences take place around the mean.

Probability

A measure quantifying the likelihood that a specific event will occur, typically expressed as a number between 0 and 1.

Uniform Density

A measure indicating that mass is evenly distributed throughout a substance or object, so each unit volume has identical mass.