The Debt Ratio of Company a Is

question 219

Multiple Choice

The debt ratio of Company A is .31 and the debt ratio of Company B is .21. Based on this information, an investor can conclude:

• A) Company A has a lower risk from its financial leverage.
• B) Company B has more debt than Company A.
• C) Company A has 10% more assets than Company B.
• D) Company B has a lower risk from its financial leverage.
• E) Both companies have too much debt.

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Definitions:

Collide

To come into forceful contact with another object, often resulting in a transfer of energy or a physical change.

Molecular-Level Collisions

Interactions between molecules that occur when their kinetic energies allow them to overcome repulsive forces and come into close contact, often resulting in chemical reactions.

High-Energy Collisions

Interactions between particles with extremely high kinetic energy, often studied to understand fundamental particles and forces.

Directed Collisions

Intentional interactions between particles, atoms, or molecules, often utilized in experimental physics to study fundamental forces and reactions.