--%>

Describe Low financial leverage and low operating leverage

Describe briefly Low financial leverage, low operating leverage?

E

Expert

Verified

This is also a bad situation where both operating leverage and financial leverage are low that results in unwanted consequences. Low degree of such leverages explains that the amount of fixed costs is extremely small and proportion of debts in capital is as well low. The management in this condition may lose number of beneficial opportunities and investments.

   Related Questions in Business Economics

  • Q : Market structure and pricing decision

    Just need help to see if I am in the right direction if there any think wrong need help with it.

  • Q : Construct a 2-D graph which comprises

    How to construct a 2-D graph which comprises drawing a horizontal and a vertical axis?

  • Q : The financial investor about bonds

    Describe three ways to finance corporate activity.  Make a case that stocks are more risky for the financial investor than are bonds?

  • Q : Expansion of preschool programs for

    Use the circular flow model to confirm this assertion for an expansion of preschool programs for disadvantaged children?

  • Q : Positive task of speculators in market

    A positive responsibility played through speculators within a market economy is to: (1) find out price levels for entrepreneurs. (2) predict the quantity at that long run equilibrium would be attained. (3) inform government organizations of consumer p

  • Q : Market system is a profit-and-loss

    Evaluate and explain the statements: “The market system is a profit-and-loss economy”

  • Q : Importance of rationally optimal

    Economic scarcity is pervasive, that makes choices essential. Therefore, rationally optimal decisions hinge upon tradeoffs which essentially reflect: (i) cooperation to minimize human greed. (ii) opportunity costs. (iii) competitive social behavior. (

  • Q : Explain about the Payments for using

    Payments for the use of land, capital and labor are respectively termed as: (w) rent, wages and profits. (x) rent, interest and wages. (y) dues, profits and depreciation. (z) fruit, profits and money.

    Q : Problem regarding to taxes and market

    The new supply and demand curves within University City are S0 and D0. But after the county commission imposed a $3 per six-pack excise tax upon beer, monthly sales of six-packs: (w) fell to 10,000, and buyers paid $6.50 each, bu

  • Q : How can we compute operating leverage

    How can we compute operating leverage?