9. You are analysing the leverage of two firms and you noted the following (all values in millions of dollars)

	Debt	Book Equity	Market Equity	Operating Income	Interest Expense
Firm A	65	75	80	45	12
Firm B	60	40	50	22	10

a) What is the market debt-to-equity ratio of each firm? (Answer to 2 decimal places)

b) What is the book debt-to-equity ratio of each firm? (Answer to 2 decimal places)

c) What is the interest cover ratio of each firm? (Answer to 2 decimal places)

d) Based on your calculations above, which of the following statement is most correct about firms A and B?

i. Firm A is most likely to default on its debt

ii. Firm B is most likely to default on its debt

iii. Lenders are more likely to favour Firm B

iv. Lenders are more likely to favour Firm