Santos Needs to Assess Its Debt Situation with Respect to the Value

question 71

Multiple Choice

Santos needs to assess its debt situation with respect to the value of the company. Which of the following, if True, would most strengthen the case that Santos's debt is manageable?

• A) Santos has a high profitability ratio.
• B) Santos has a high inventory turnover ratio.
• C) Santos has a low inventory turnover ratio.
• D) Santos has a high debt to owners' equity ratio.
• E) Santos has a low debt to owners' equity ratio.

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Definitions:

Labor-Force Participation Rate

The labor-force participation rate is the percentage of the working-age population that is either employed or actively seeking employment.

Bureau of Labor Statistics

A U.S. government agency responsible for collecting and analyzing economic data related to labor market activity, working conditions, and price changes.

True Unemployment Rate

A measure of the actual number of unemployed individuals, considering those who have stopped looking for work or are underemployed.