Which of the following statements is true?

W and Y are very similar entities with the same level of profit before interest and tax.

However, W has gearing of 95% and Y has gearing of 30%.

Which of the following statements is true?
A . Investing in W carries a higher level of risk than investing in
C . A greater proportion of profit will be available out of which to declare a dividend in
E . Investors in Y will expect a higher return than investors in
G . Y has a greater commitment to meet interest payments than

View Answer

Answer: A