Which company would a lender prefer to work with

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Reference no: EM13296429

Company ABC has $350,000 in total dept and $450,000 in total equity. Company XYZ has $700,000 in total assets, one third have been financed by equity and two thirds which have been financed by dept. Based on their dept-to equity ratios, which company would a lender prefer to work with?

possible answers:
company XYZ
company ABC
Neither company is desirable
Both companies are equally desirable

Reference no: EM13296429

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