n NISM Certifications
XXI NISM Series XXI-A
Medium

What does the "Debt-Equity Ratio" measure?

Practice question from NISM XXI A for PMS - Mock Test 1 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. The proportion of debt used to finance assets relative to shareholders’ equity

    Correct answer

  2. B

    The company's profitability

  3. C

    The company's liquidity position

  4. D

    The company's market capitalization

Why this is the answer

Debt-equity ratio assesses leverage.

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