The amount that investors are willing to pay for each dollar of annual earnings is reflected in the: debt-equity ratio. return on assets. DuPont identity. O price-earnings ratio. return on equity. A banker considering loaning money to a firm for ten years would most likely prefer the firm have a debt ratio of and a times interest earned ratio of 0.40; 1.75 0.50: 1.00 0.50: .75 0.40.75 0.45; 1.75 Question 3 The higher the inventory turnover, the: O greater the amount of inventory held by a firm. less time inventory items remain on the shelf. longer it takes a firm to sell its inventory. higher the inventory as a percentage of total assets. O greater the selection of goods available for sale. Question 4 Last year, Alfred's Automotive had a price-earnings ratio of 15 and earnings per share of $1.20. This year, the price-earnings ratio is 18 and the earnings per share is $1.20. Based on this information, it can be stated with certainty that: O the earnings per share decreased. investors are paying a lower price per share this year as compared to last year. the investors' outlook for the firm has improved. investors are receiving a higher rate of return this year. O the price per share decreased