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A company's balance sheet shows total assets of $1,000,000 and total liabilities of $400,000. If the owner's equity is $600,000, calculate the debt-to-equity ratio and

· A company's balance sheet shows total assets of $1,000,000 and total liabilities of $400,000. If the owner's equity is $600,000, calculate the debt-to-equity ratio and discuss its implications for the company's financial leverage and risk management. Explore how variations in the debt-to-equity ratio reflect differences in capital structure preferences and their impact on cost of capital, financial flexibility, and shareholder returns.

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