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icang [17]
1 year ago
5

You find that a firm has a total debt ratio of 0. 63. what is the equity multiplier for this firm?

Business
1 answer:
Tamiku [17]1 year ago
8 0

A company's overall debt to equity ratio is 0.63. This company's equity multiplier is1.63.

The phrase "debt ratio" refers to a financial ratio that assesses how much leverage a business has. The ratio of total debt to total assets, represented as a decimal or percentage, is known as the debt ratio. The percentage of a company's assets that are financed by debt is one way to understand it. An asset-to-asset ratio greater than 1 indicates that a significant portion of a firm's assets are financed by debt, which indicates that the corporation has more liabilities than assets. If interest rates abruptly increase, a company with a high ratio may be at risk of loan default. A ratio less than 1 indicates.

Learn more about equity multiplier here.

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