There Was an Upward Trend in the Ratio of the Book

question 24

Multiple Choice

There was an upward trend in the ratio of the book value of debt to the book value of debt and equity throughout the 1990s.Some of this was due to the repurchasing of shares.The market value ratio of debt to debt and equity exhibited no upward trend.This can be explained by:

• A)the change in the accounting rules of the period.
• B)the difference between tax accounting and accounting for financial accounting purposes.
• C)a large increase in the market value of equity that was greater than the increase in debt.
• D)All of the above.
• E)None of the above.

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Definitions:

Chemical

A substance with a distinct molecular composition that is produced by or used in a chemical process.

Carcinomas

A type of cancer that begins in the skin or the tissue lining organs, such as the liver or kidneys.

Epithelial Tissues

Layers of cells that line or cover the body surfaces, both internal and external, playing roles in protection, secretion, and absorption.

Bx

A shorthand notation for biopsy, a medical test involving the extraction of sample cells or tissues for examination.