Instead of Increasing Its Long-Term Debt by Borrowing Money to Purchase

question 42

Multiple Choice

Instead of increasing its long-term debt by borrowing money to purchase new stereo equipment,Jay's Jams Inc.decides to lease the equipment.How does this affect its long-term debt ratio?

• A) It will decrease.
• B) It will increase.
• C) It will remain unchanged.
• D) The effects are unknown without the amount of the lease obligation.

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Definitions:

Group Setting

The physical or social context in which a group operates or interacts.

Counseled

Provided professional guidance in resolving personal or psychological problems.

Leader

An individual who guides or directs a group towards achieving goals through influencing, motivating, and providing direction.

Cognitive-behavioral Therapy

A psychotherapeutic treatment that helps patients understand the thoughts and feelings that influence behaviors, commonly used to treat a variety of disorders.