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    Question

    A firm reporting a debt-to-equity ratio of 0.69 is most

    accurately described by which of the following statements regarding its leverage position?
    A Highly leveraged Correct Answer Incorrect Answer
    B Moderately leveraged Correct Answer Incorrect Answer
    C Minimally or conservatively leveraged Correct Answer Incorrect Answer
    D Debt-free or zero leverage Correct Answer Incorrect Answer
    E Critically leveraged and risky Correct Answer Incorrect Answer

    Solution

    A 0.69 ratio means the firm has ₹0.69 debt for every ₹1 of equity, indicating a moderate level of leverage—not too risky, not overly conservative.

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