Which of the Following Financial Ratios Is Not Used to Develop

question 40

Multiple Choice

Which of the following financial ratios is not used to develop Altman's Z score from multiple discriminate analysis?

• A)Market value of equity/book debt
• B)EBIT/total assets
• C)Interest expense/total assets
• D)Working capital/total assets

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Definitions:

High-Risk Bond

A bond with a lower credit rating, indicating a higher risk of default, but offering higher potential returns to compensate for this risk.

High Yields

Bonds that offer higher interest rates because they have lower credit ratings, implying greater risk of default.

Oligopolies

Markets dominated by a small number of large firms, leading to limited competition.

Merger Waves

Periods of increased activity and volume in mergers and acquisitions across various industries, typically linked to economic, regulatory, or technological changes.