Statement (I) : A debt-equity ratio of 2 : 1 indicates that for every 1 unit of equity, the company has raised 2 units of debt.

Statement (II) : The cost of floating an equity issue is lesser than the cost of floating a debt

  • Both the Statements (I) and (II) are false. 

  • Both the Statements (I) and (II) are true.

  • Statement (I) is false and Statement (II) is true.         

  • Statement (I) is true and Statement (II) is false