Which of the Following Statements Is TRUE of the Debt

question 206

Multiple Choice

Which of the following statements is TRUE of the debt to equity ratio?

• A) The higher the debt to equity ratio, the lower the company's financial risk.
• B) The higher the debt to equity ratio, the greater the company's financial risk.
• C) If the debt to equity ratio is greater than 1, the company is financing more assets with equity than with debt.
• D) If the debt to equity ratio is less than 1, the company is financing more assets with debt than with equity.

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Definitions:

Cerebellum

The part of the brain that controls muscular coordination and equilibrium.

Hindbrain

The rear part of the brain that includes the cerebellum and brainstem, involved in regulating basic life functions like heartbeat and breathing.

Brain Parts

Various structures within the brain, each responsible for different functions, such as the cerebrum for thought and action, the cerebellum for movement, and the brainstem for basic life functions.

Basic Life Functions

Fundamental processes necessary for an organism to live, including respiration, nutrition, excretion, and reproduction.