If a Firm Has Three Times as Much Equity as Debt

question 72

Multiple Choice

If a firm has three times as much equity as debt in its capital structure, then the firm has:

• A)25.0% debt
• B)66.7% equity
• C)40.0% debt
• D)33.3% equity Let x = % of debt
• Then 3x = % of equity
• And 4x = 100% \(\rarr\) x = 25.0%

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An uncomfortable, irritating sensation that leads to the desire to scratch, commonly referred to as itchiness.

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