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________ Ratio Indicates That a Firm Will Be Able to Meet

question 152

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________ ratio indicates that a firm will be able to meet interest obligations due on outstanding debt.


Definitions:

Quoted Price

The last price at which a security or commodity traded, often used as a reference to gauge market value.

Current Yield

The annual income (interest or dividends) divided by the current price of the security.

Semiannually

Occurring twice a year; typically every six months.

Subordinated Debt

A class of debt that is ranked below other debts with regard to claims on assets or earnings in the event of a liquidation of the issuer.

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