What is emphasized to ascertain the best ratios of securities in the capital gearing decision? Question 13Answer a. Earnings prospects b. Liquidity balances c. The capital gearing technique d. Market conditions
In the context of capital gearing decisions, the emphasis is typically on a. Earnings prospects. This is because the ability of a company to generate earnings is crucial in determining how much debt it can safely take on relative to equity. While liquidity balances, the capital gearing technique, and market conditions are also important factors, earnings prospects are often the primary consideration when assessing the appropriate ratios of securities.