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Explain the risk of investing in a company based on debt-equity-ratio.
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- The cost of equity is _______. A. the interest associated with debt B. the rate of return required by investors to incentivize them to invest in a company C. the weighted average cost of capital D. equal to the amount of asset turnoverWhat is the impact on stockholders equity when a company uses debt financing as a source of funding?An investor worried about a company’s long-term solvency would most likely examine its:C . debt-to-equity ratio
- Which of the following risk is affected largely by the debt-to-equity ratio? Liquidity risk Financial risk Management risk Overall Business riskThe cost of equity is ________. Group of answer choices A. the interest associated with debt B. the rate of return required by investors to incentivize them to invest in a company C. the weighted average cost of capital D. equal to the amount of asset turnoverDiscuss how do you analyze a company's performance using financial ratios? Which ratios are most important to look at for a creditor? Which ratios are most important to look at for a sharehold er?
- What does issuing equity instea of debt signal about the financial health of a company?What is the relationship of business risk, financial risk, and stand-alone risk? How to calculate the financial risk for a firm?The cost of equity is ________. a.equal to the amount of asset turnover b.the interest associated with debt c.the weighted average cost of capital d.the rate of return required by investors to incentivize them to invest in a company
- Help me pleaseWhich of the following is the correct explanation for the purpose of financial risk ratios? Select one: a. They show the relative levels of liquid assets of the company. b. They show the relative proportion of debt items with respect to shareholders' equity or total capital. c. They show the profitability of the company over a specific period of time. d. They show the probability of whether the company will face problems in operations.Which of the following is the correct explanation for the purpose of financial risk ratios? Select one: O a. They show the relative proportion of debt items with respect to shareholders' equity or total capital. b. They show the profitability of the company over a specific period of time. c. They show the probability of whether the company will face problems in operations. O d. They show the relative levels of liquid assets of the company.
