The debt ratio, calculated by dividing total liabilities by total assets, measures the proportion of...
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The debt ratio, calculated by dividing total liabilities by total assets, measures the proportion of a company's assets financed by debt. A higher ratio indicates greater leverage and financial risk, while a lower ratio suggests a more conservative financial structure. This ratio is crucial for investors and creditors to assess the company's financial stability and risk profile. It provides insights into the company's ability to meet its debt obligations and sustain longterm operations.
The debt ratio, calculated by dividing total liabilities by total assets, measures the proportion of a company's assets financed by debt. A higher ratio indicates greater leverage and financial risk, while a lower ratio suggests a more conservative financial structure. This ratio is crucial for investors and creditors to assess the company's financial stability and risk profile. It provides insights into the company's ability to meet its debt obligations and sustain longterm operations.
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