A firm's leverage ratio is 1.2, interest-burden ratio is 0.81, and profit margin is 0.25, and its asset turnover is 1.1. What is the firm's compound leverage factor?
A) 0.243
B) 0.267
C) 0.826
D) 0.972

Name: A firm's leverage ratio is 1.2, interest-burden ratio is 0.81, and profit margin is 0.25, and its asset turnover is 1.1. What is the firm's compound leverage factor? A) 0.243 B) 0.267 C) 0.826 D) 0.972
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Question

Quizplus · Accepted Answer

Compound leverage factor = 1.20 × 0.81 = 0.972

A Firm's Leverage Ratio Is 1