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You are considering a stock investment in one of two firms (LotsofDebt, Inc. and LotsofEquity, Inc.), both of which operate in the same industry. LotsofDebt,

You are considering a stock investment in one of two firms (LotsofDebt, Inc. and LotsofEquity, Inc.), both of which operate in the same industry. LotsofDebt, Inc. finances its $32.50 million in assets with $30.25 million in debt and $2.25 million in equity. LotsofEquity, Inc. finances its $32.50 million in assets with $2.25 million in debt and $30.25 million in equity.

Calculate the debt ratio. (Round your answers to 2 decimal places.)

Debt ratio
Lots of Debt %
Lots of Equity %

Calculate the equity multiplier. (Round your answers to 2 decimal places.)

Equity multiplier
Lots of Debt times
Lots of Equity times

Calculate the debt-to-equity. (Round your answers to 2 decimal places.)

Debt-to-equity
Lots of Debt times
Lots of Equity

times

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