The debt-to-equity ratio for a company is 0.55. If there is $4,500 in total equity, the equity multiplier is 1.55.
What is debt-to-equity ratio?
A financial ratio called the debt-to-equity ratio shows how much debt and equity were utilized to finance the assets of a corporation. Leverage, risk, and gearing are all terms used to describe the ratio, which is closely related to leveraging.
What Is the Equity Multiplier?
A risk indicator known as the equity multiplier calculates the percentage of a company's assets that are funded by equity rather than debt. The formula for calculating it is to divide a company's total asset value by the sum of its shareholders' equity.
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