Series 79 practice questionmediumDebt to Equity Ratio
A company has total liabilities of $600 million and total equity of $400 million. What is its debt-to-equity ratio?
- A1.5✓ Correct answer
- B0.67
- C1.0
- D0.40
Explanation
Why A — 1.5
Debt-to-equity = Liabilities / Equity = $600m/$400m = 1.5. The other choices use incorrect numerator or denominator or miscalculate the ratio.
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