Question : If the debt-equity ratio is 0.43: 1. What will the ratio indicate with respect to the company's financial position?

Option 1: It indicates that the long-term financial position of the company is very sound

Option 2: It indicates that the long-term financial position of the company is weak

Option 3: It indicates that the short term financial position of the company is very sound

Option 4: It indicates that the short-term financial position of the company is very weak

Question : Which of the following statements is incorrect?

Option 1: Debt equity ratio is calculated to assess the ability of the firm to meet its long-term liabilities.

Option 2: If the debt-equity ratio is more than that, it shows a rather risky financial position from the long-term point of view.

Option 3: debt-equity ratio of 1: 1 is considered safe.

Option 4: A high debt-equity ratio is a danger signal for long-term lenders.

Question : Which of the following statements is correct?

Option 1: Debt to equity ratio indicates the proportion of funds which are acquired by long-term borrowings in comparison to shareholder's funds.

Option 2: The debt to equity ratio is calculated to ascertain the soundness of the long-term financial policies of the firm.

Option 3: Debt Equity Ratio $=\frac{\text { Debt }}{\text { Equity }}$

Option 4: All of the above

Question : Which of the following statements is correct?

Option 1: Debt to equity ratio indicates the proportion of funds which are acquired by long-term borrowings in comparison to shareholder's funds.

Option 2: The debt to equity ratio is calculated to ascertain the soundness of the long-term financial policies of the firm.

Option 3: Debt Equity Ratio $=\frac{\text { Debt }}{\text { Equity }}$

Option 4: All of the above

Question : It helps in fixing the ratio between debt and equity in the long term finance. Which financial activity is highlighted in the given statement?

Option 1: Amount of long term and short term financing

Option 2: Quantum of current assets

Option 3: Breakup of long term financing into debt and equity.

Option 4: Size as well as composition of fixed assets.