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Finance Formulas / July 19, 2018 / Alia Marquez

The debt ratio is a financial ratio that measures the extent of a company’s leverage. The debt ratio is defined as the ratio of total debt to total assets, expressed as a decimal or percentage. It can be interpreted as the proportion of a company’s assets that are financed by debt.

Loans can be confusing. Slick lenders quote different numbers that mean different things. They might include certain costs that you're likely to pay, or they might omit those costs in advertisements and brochures.

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