--%>
Assignment Help - homework help

Introduction of the term Financial Leverage

Give a brief introduction of the term Financial Leverage?

E

Expert

Verified

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.

   Related Questions in Business Economics

  • Q : Divide of the study of economics MOST

    The study of economics is MOST frequently divided within: (1) positive economics and negative economics. (2) macroeconomics and microeconomics. (3) subjective economics and objective economics. (4) supply side and demand side economics. (5) conservative economics and

    		•
  • Q : Best alternatives while choices are made

    Opportunity costs, which are the values of the: (i) monetary costs of goods and services. (ii) best alternatives sacrificed while choices are made. (iii) minimal budgets of families upon welfare. (iv) hidden charges passed upon to consumers. (v) exorb

    		•
  • Q : David Hume statement regarding money in

    In modern parlance, David Hume statement regarding money which is Tis none of the wheels of trade. And tis the oil, was referring to the notion that money: (i) is relatively costly to produce. (ii) facilitates divisions of labor and specialization and

    		•
  • Q : Demand supply Newspaper item: “Due to

    Newspaper item: “Due to lower grain prices, consumers can expect retail prices of choice beef to begin dropping slightly this spring with pork becoming cheaper after midsummer,” the Agriculture Department predicted. “This reflects increasing supply,” the department said. Does the statement use th

    		•
  • Q : Real exchange rate Question: To

    Question: To determine the real exchange rate, what two pieces of information do you need in addition to the nominal exchange rate? Answer:

    Q : Basic supply determinants of other than

    Illustrate the 6 basic supply determinants of other than price?

    		•
  • Q : Requirement of building blocks for a

    Building blocks for a capitalist system consist of: (1) supplies and demands. (2) private property rights. (3) laissez-faire policies. (4) market-determined outputs and prices. (5) All of the above. Please guys hel

    		•
  • Q : Budget line and indifference curves

    Question: Monica has been considering buying a mountain bike. Last month Monica had an income of $30,000. The bike's price was $1000, the composite good price was $1, and she decided not to buy the bike.  This month Monica was surprised t

    		•
  • Q : Write short note on Markets Write short

    Write short note on Markets?

    		•
  • Q : Unpredictable and frequent fluctuations

    Adam Smith attributed unpredictable and frequent fluctuations within profits to: (i) variations in the prices of the goods a firm or person produces and sells. (ii) the bad or good fortune of rivals. (iii) the good or bad fortune of customers. (iv) tr

    		•