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April 4, 2023

In addition to calculating ratios, we also want to understand how to interpret them. A good way to do so is to analyze how market factors impact them. What effect will a decline in

In addition to calculating ratios, we also want to understand how to interpret them. A good way to do so is to analyze how market factors impact them. What effect will a decline in interest rates have on the firm's times interest earned ratio? What about the ratio of the market value of debt to that of equity? Would you judge that the leverage has increased or decreased?

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