What Will Be the Effect on Apex's Debt Ratio If

question 148

Multiple Choice

What will be the effect on Apex's debt ratio if Apex's owner invests an additional $2 million to finance its expansion?

• A) The debt ratio will decrease from .1 (2/20) to .0909 (2/22) after the additional investment.
• B) The debt ratio will decrease from 2/9 before to 2/11 after the additional investment.
• C) The debt ratio will increase from 20 before to 22 after the additional investment.
• D) Additional investment by owner will have no effect on the debt ratio.

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