Multiple Choice
Which of the following statements is CORRECT?
A) Other things held constant,the more debt a firm uses,the higher its operating margin will be.
B) Debt management ratios show the extent to which a firm's managers are attempting to magnify returns on owners' capital through the use of financial leverage.
C) Other things held constant,the more debt a firm uses,the higher its profit margin will be.
D) Other things held constant,the higher a firm's total debt to total capital ratio,the higher its TIE ratio will be.
E) Debt management ratios show the extent to which a firm's managers are attempting to reduce risk through the use of financial leverage.The higher the total debt to total capital ratio,the lower the risk.
Correct Answer:
Verified
Correct Answer:
Verified
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