A Total Debt Ratio of 0.35

question 8

Multiple Choice

A total debt ratio of 0.35:

• A) indicates that the firm is financed with 35% long-term debt.
• B) would exist if a firm had liabilities of $700 and assets of $2,000.
• C) indicates that 35 cents of every dollar of capital is in the form of short-term debt.
• D) indicates that 35 cents of every dollar of capital is in the form of long-term debt.

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