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K You are analyzing the leverage of two firms and you note the following (all values in millions of dollars): Debt Firm A Firm
K You are analyzing the leverage of two firms and you note the following (all values in millions of dollars): Debt Firm A Firm B 499.3 81.6 Book Equity 303.5 33.1 Market Equity 404.3 Operating Income 101.6 7.7 Interest Expense 48.2 7.1 a. What is the market debt-to-equity ratio of each firm? b. What is the book debt-to-equity ratio of each firm? c. What is the interest coverage ratio of each firm? 38.1 d. Which firm will have more difficulty meeting its debt obligations?
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