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An asset price suddenly increased by 10%. Multiplication by which of the following leverage ratios will give the proportional increase in equity or net wealth?
An asset price suddenly increased by 10%. Multiplication by which of the following leverage ratios will give the proportional increase in equity or net wealth? In other words, the asset capital return over a short time multiplied by what ratio will give the equity capital return over that same short time? Select one: O a. Debt-to-assets ratio O b. Debt-to-equity ratio O c. Equity-to-assets ratio O d. Equity-to-debt ratio e. Asset-to-equity ratio
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