Question

If Company A has a debt-to-assets ratio of 0.73 while Company B has a debt-to-assets ratio of 0.45, which of the following statements is correct?

A) Stockholders own a smaller proportion of Company A than Company B.

B) Company A must make less profit than Company B.

C) Creditors own a smaller proportion of Company A than Company B.

D) Company A must have fewer assets than Company B.

Answer

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