Long-term creditors consider a lower debt to assets ratio to be less risky.

Name: Long-term creditors consider a lower debt to assets ratio to be less risky.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Long-term creditors are concerned about their ability to be repaid by the company over the long term. A lower debt to assets ratio indicates that the company has less debt relative to its assets, which is generally perceived as a positive factor and lower risk.

Long-Term Creditors Consider a Lower Debt to Assets Ratio to Be