John Davis has a debt ratio of 0.25, which tells us that John
A)
is insolvent since the ratio is less than 1.0.
B)
could have $10,000 in total assets and $7,500 in net worth.
C)
has 25% of his income allocated to reducing debt.
D)
might have $2,500 in liquid assets and $10,000 in current debts.
B
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