Q. XYZ Company has a ratio of (total debt/total assets) that is above the industry...

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Accounting

Q. XYZ Company has a ratio of (total debt/total assets) that is above the industry average, and a ratio of (long term debt/equity) that is below the industry average. These ratios suggest that the firm:

1.

utilizes assets effectively

2.

has too much equity in the capital structure

3.

has relatively high current liabilities

4.

has a relatively low dividend payout ratio

5.

None of the above

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