What Best Explains Why a Firm's Ratio of Long-Term Debt/total

Multiple Choice

What best explains why a firm's ratio of long-term debt/total capital is lower than the industry average, while the ratio of income before interest and taxes/debt interest charges is lower than the industry average

A) The firm pays lower interest on long-term debt than the average firm.
B) The firm has more short-term debt than average.
C) The firm has a high ratio of current assets/current liabilities.
D) The firm has a high ratio of total cash flow/long term debt.
E) None of the options