Question

Debt-equity ratio is sub-part of ____________.

• A. Short-term solvency ratio
• B. Long-term solvency ratio
• C. Debtors turnover ratio
• D. None of the above

Answer 1

The correct option is B Long-term solvency ratio

The debt-to-equity ratio is a financial ratio indicating the relative proportion of shareholders' equity and debt used to finance a company's assets. Closely related to leveraging, the ratio is also known as risk, gearing or leverage.