Posted in Debt Ratio
The borrower’s monthly obligation divided by their income. This is also known as debt-to-income ratio. For companies, the debt ratio gives investors an idea on the financial health of the company or its ability to face risks with its debt load. It also gives an insight on the ability of the individual or the company to pay its debt. Debt ratio is only one of the many tools that can help present the whole financial picture of a company.
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