If the Ratio of Total Stockholders' Equity to Total Assets

question 22

Multiple Choice

If the ratio of total stockholders' equity to total assets was greater in 2013 than in 2012, then

• A) total assets increased by a greater amount than did total stockholders' equity.
• B) the ratio of total liabilities to total assets was smaller in 2013 than in 2012.
• C) creditors would consider it riskier to lend to this company in 2013 than in 2012.
• D) the ratio of total liabilities to total assets was larger in 2013 than in 2012.

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Definitions:

Digest

The process of breaking down food through mechanical and chemical means into substances that can be absorbed and assimilated by the body.

James-Lange Theory

A theory of emotion suggesting that physiological arousal precedes the experience of emotion, implying that emotions are a result of the interpretation of bodily reactions.

Appraisal Theory

A theory in psychology that describes how individuals evaluate events as beneficial or harmful to their well-being, which then determines their emotional response.

Emotion

A complex psychological state involving subjective feelings, physiological arousal, and observable behavior.