A Firm Has Total Debt of $1,200 and a Debt-Equity

question 110

Multiple Choice

A firm has total debt of $1,200 and a debt-equity ratio of .40. What is the value of the total assets?

• A) $1,680
• B) $3,000
• C) $3,520
• D) $4,200
• E) $5,300

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Definitions:

Debtor

An individual or entity that owes a debt to another individual or entity, referred to as the creditor.

Credit Report

A detailed report of an individual's credit history prepared by a credit bureau, used by lenders to determine creditworthiness.

Credit Bureau

An agency that collects and aggregates individuals' credit information, providing credit reports to lenders.

Consent

Agreement or approval given freely and deliberately by a competent individual.