Consider the information on the three firms A, B, and C:
Capital |
Firm A |
Firm B |
Firm C |
Debt |
$1,000 |
$2,000 |
$3,000 |
Equity |
$3,000 |
$2,000 |
$1,000 |
a. Calculate the debt ratio for each firm.
b. Calculate the debt-to-assets ratio for each firm.