Quiz Ch 04 – T/F Relationship Between Debt Ratios
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition
True or false: Assuming all else remains constant, a rise in a firm’s total debt to total capital ratio [(Short-term debt + Long-term debt)/(Debt + Preferred stock + Common equity)] is likely to lead to a higher TIE (Times Interest Earned) ratio.