If a Firm Has Twice as Much Equity as Debt

question 40

Multiple Choice

If a firm has twice as much equity as debt in its capital structure,then the firm is financed with:

• A) 75.0% debt.
• B) 66.7% equity.
• C) 40.0% debt.
• D) 33.3% equity.

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Definitions:

Client-visits

Client-visits refer to the occasions on which a service provider or salesperson goes to see clients in their place of business or home.

Activity Variance

The discrepancy between what was planned to be spent on an activity and what was actually spent.

Budgeting

The act of designing a budget to allocate your finances, enabling you to predict beforehand if you'll possess sufficient funds to cover necessary or desired activities.

Total Expenses

The sum of all costs and expenses, both operational and non-operational, that a business incurs within a particular period.