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Question

Debt Equity Ratio = ___/ Shareholder`s funds


A

External liabilities

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B

Internal Liabilities

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C

Equity share capital

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D

All of these

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Solution

The correct option is A

External liabilities


Debt to equity ratio is the ratio of a firm's long term external debt to its shareholders' funds i.e.
Debt equity ratio = External liabilities / Shareholder`s funds


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