GE Is Highly Leveraged

question 79

Multiple Choice

GE is highly leveraged.Financial analysts look at its ____ ratio to determine if it can make interest payments.

• A)coverage
• B)operating
• C)debt
• D)return
• E)None of these.

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Definitions:

Simple Interest

The calculation of interest paid or received over a certain period that is based only on the principal amount, not including interest on interest.

Promissory Note

A financial instrument containing a written promise by one party to pay another a definite sum of money either on demand or at a specified future date.

Treasury Bill

A short-term government debt instrument issued at a discount from the face value and pays no interest before maturity.

Simple Interest

The calculation of interest that is based only on the original principal amount and does not include interest on interest.