A Firm's Goal Is to Maintain a 75% Debt-Equity Ratio

question 86

Multiple Choice

A firm's goal is to maintain a 75% debt-equity ratio.How much equity would be required if the results of a financial planning model indicate that the firm's assets will grow to $4 million?

• A)$1.00 million
• B)$1.71 million
• C)$2.29 million
• D)$3.00 million If debt is 75% as large as equity, then:
• 1)75 equity = $4.0 million

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Definitions:

Blastocyst

A collection of about 100 human cells that develops from the zygote.

Gastrulation

An early embryonic phase during which the single-layered blastula is reorganized into a multilayered structure known as the gastrula.

Uterine Cavity

The interior part of the uterus, where the embryo implants and develops during pregnancy.

Lanugo

The fine, downy hair covering the fetus.