Debt-Equity ratio helps to study_____________. a. Solvency b. Liquidity c. Profitability d. Turnover
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It helps to study solvency
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The debt-Equity ratio helps to study (a) solvency.
Solvency:
- Solvency is one indicator of a company's financial health since it shows how well it can manage operations shortly.
- Ratios can be used by investors to assess a company's solvency.
- When assessing solvency, it's usually a good idea to look at liquidity as well, because a corporation can be bankrupt but make consistent quantities of liquidity.
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