question 1 out of 4\nif your total assets equal $100,000 and your total liabilities equal $10,000, your…

question 1 out of 4\nif your total assets equal $100,000 and your total liabilities equal $10,000, your solvency ratio is\ntype your answer here\nsubmit\n0 / 4 questions correct\nstart over

question 1 out of 4\nif your total assets equal $100,000 and your total liabilities equal $10,000, your solvency ratio is\ntype your answer here\nsubmit\n0 / 4 questions correct\nstart over

Answer

Explanation:

Step1: Recall solvency - ratio formula

Solvency ratio = $\frac{\text{Net Worth}}{\text{Total Assets}}$, and Net Worth = Total Assets - Total Liabilities.

Step2: Calculate net worth

Net Worth = $100000 - 10000=90000$.

Step3: Calculate solvency ratio

Solvency ratio = $\frac{90000}{100000}=0.9$.

Answer:

$0.9$