📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

  • google app store apple app store
  • ✖

      Question

      A company’s debt-to-equity ratio increases from 1.5 to

      2.5 over the year. What can be a likely interpretation?
      A The company has issued more equity Correct Answer Incorrect Answer
      B The company’s financial leverage has decreased Correct Answer Incorrect Answer
      C The company has borrowed more debt Correct Answer Incorrect Answer
      D The retained earnings have increased Correct Answer Incorrect Answer

      Solution

      An increase in the debt-to-equity ratio indicates greater reliance on external borrowings.

      Practice Next
      ask-question