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  • Directions: State whether the following statement is True...
Multiple choice

Directions: State whether the following statement is True Or False.

Capital gearing is the ratio of debt to equity.

  1. True

  2. False

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Capital gearing is the ratio of fixed-interest-bearing capital (debt and preference shares) to equity capital. It is not simply the ratio of debt to equity.

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