The Highest Possible Value for the Interest-Burden Ratio Is ________

question 60

Multiple Choice

The highest possible value for the interest-burden ratio is ________, and this occurs when the firm ________.

• A) 0; uses as much debt as possible
• B) 1; uses debt to the point where ROA = interest cost of debt
• C) 1; uses no interest-bearing debt
• D) -1; pays down its existing debts

---

Definitions:

Scleral Venous Sinus

A circular channel in the eye that drains aqueous humor from the anterior chamber into the bloodstream.

Aqueous Humor

The clear fluid filling the space in the front of the eyeball between the lens and the cornea, maintaining pressure and providing nutrients to the eye.

Auditory Tube

The tube that connects the middle ear cavity with the nasopharynx, helping equalize pressure between the middle ear and atmosphere.

Crista Ampullaris

A sensory structure within the semicircular canals of the inner ear, critical for maintaining balance by detecting rotational movements.