Capital structure ratios are also known as:
A) profitability ratios.
B) liquidity ratios.
C) gearing ratios.
D) efficiency ratios.

Question

Quizplus · Accepted Answer

Capital structure ratios are also known as gearing ratios. These ratios help in evaluating the degree of debt and equity used by a company to finance its operations. Some common examples of capital structure ratios include debt-to-equity ratio, debt-to-capital ratio, and interest coverage ratio. Profitability ratios are used to measure a company's ability to generate profits, liquidity ratios are used to evaluate a company's ability to meet short-term obligations, and efficiency ratios are used to measure a company's operational efficiency.

Capital Structure Ratios Are Also Known As