Introduction of the term Financial Leverage
Give a brief introduction of the term Financial Leverage?
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It is a leverage that refers to high level of profitability due to high fixed financial expenditures. It consists of preference dividend and interest on loan. Higher financial leverage points out higher financial risk and higher break points. In this category the managers have flexibility in the choice of capital structure.
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Describe briefly Operating income approach?
Question: What can we learn from the Japanese experience? Is the US headed for a 'lost decade? Answer: There was
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