The degree to which the managers of a firm attempt to magnify the returns to owners' capital through the use of financial leverage is captured in debt management ratios.

Question

Quizplus · Accepted Answer

Debt management ratios are used to measure how much a company is relying on debt to finance its operations and investments. These ratios help to determine the degree to which managers attempt to increase returns to owners by using financial leverage. Therefore, the statement is true.

The Degree to Which the Managers of a Firm Attempt