Question: Which statement about debt management ratios and financial leverage is FALSE? Multiple Choice Creditors and stockholders have different views about the optimal debt to equity

Which statement about debt management ratios and financial leverage is FALSE?

Multiple Choice

Creditors and stockholders have different views about the optimal debt to equity ratio.

Ordinarily, creditors would like a lot of debt to take advantage of positive financial leverage.

The most common measure of a company's ability to provide protection to long-term creditors is the times interest earned ratio.

As the debt to equity ratio increases, it indicates that a company is increasing its financial leverage.

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