Question

    A company has total debt of ₹200 crore and equity of

    ₹10 crore. What is its Debt-Equity ratio?
    A 20:1 Correct Answer Incorrect Answer
    B 2:1 Correct Answer Incorrect Answer
    C 0.5:1 Correct Answer Incorrect Answer
    D 1:10 Correct Answer Incorrect Answer
    E 10:1 Correct Answer Incorrect Answer

    Solution

    Debt-Equity Ratio = Total Debt / Equity = 200 / 10 = 20:1, indicating high leverage and risk.

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