All of the Following May Be Included in the Numerator

question 6

Multiple Choice

All of the following may be included in the numerator of the debt-to-equity ratio except:

• A) Short-term bank loans.
• B) Retractable preferred shares.
• C) Current portion of long-term debt.
• D) Shareholder loans.

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Definitions:

Good A

A placeholder term typically used in economic models to represent a generic item or service in the market.

Income Falls

A situation where an individual's or group's earnings decrease over a period of time.

Normal Good

A good for which an increase in income raises the quantity demanded.

Inferior Good

A type of good for which demand decreases as the income of consumers increase, unlike normal goods for which demand increases with an increase in income.