Which of These Ratios Measure the Extent to Which the Firm

question 113

Multiple Choice

Which of these ratios measure the extent to which the firm uses debt (or financial leverage) versus equity to finance its assets?

• A)Debt management ratios
• B)Equity ratios
• C)Financial ratios
• D)Liquidity ratios

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Definitions:

Average

A statistical measure representing the central or typical value in a set of data, calculated primarily as the mean, median, or mode.

Total

It refers to the whole amount, quantity, or number of something, considered without divisions or exceptions.

Relative Frequency

The ratio of the number of times a particular event occurs to the total number of trials or instances.

Distribution

In logic, refers to the manner in which terms in propositions are applied to all of their potential subjects or only to some.