Which of the Following Is the Correct Formula to Calculate

question 207

Multiple Choice

Which of the following is the correct formula to calculate the debt ratio?

• A) Debt ratio = Total liabilities × Total assets
• B) Debt ratio = Total liabilities + Total assets
• C) Debt ratio = Total liabilities - Total assets
• D) Debt ratio = Total liabilities / Total assets

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Definitions:

Positive Slopes

Characteristics of a line or curve on a graph indicating that values of the variable on the y-axis increase as the values of the variable on the x-axis increase.

Equilibrium

The state in which market supply and demand balance each other, resulting in stable prices.

Normal Goods

Goods for which demand increases when consumer income rises, and decreases when consumer income falls.

Consumption

The use of goods and services by households or individuals, constituting one of the primary components of an economy's aggregate demand.