A ratio which measures a company's ability to pay interest on its debt is called the:

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The interest coverage ratio measures a company's ability to pay interest on its debt by comparing the earnings before interest and taxes (EBIT) to the interest expense. A higher interest coverage ratio indicates that a company has a better ability to pay its interest expenses. Options A, B, and D measure different aspects of a company's financial health, but do not directly measure its ability to pay interest.

A Ratio Which Measures a Company's Ability to Pay Interest