what do you mean by debt equity ratio?
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Answer Posted / mahendar
The ratio measure the relative claims of the creditors, and
the owners against the firm assets. The relationship
between the long-term funds and the shareholders funds.
high debt-equity ratio implies the creditors margin of
saftey,firm point of view low debt-equity ratio greter the
margin of saftey.
high debt using the firm conservatism method more then
equity.
D/e ratio=long term funds/shareholders funds
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