Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. when a company uses financial leveraging, are the

When a company uses financial leveraging, are the investors using their own money?

50.1K

Verified Solution

Question

Finance

When a company uses financial leveraging, are the investorsusing their own money?

Answer & Explanation Solved by verified expert
4.0 Ratings (791 Votes)
The Straight answer is NO In simple words using financial leverage means using borrowed money to control a greater amount of assets With financial leverage there will be an increase in the value of the assets that will result in a larger gain on the owners cash when the loan interest rate is less than the rate of increase in the assets value Examples of Financial Leverage Mary uses 500000 of her cash to purchase 40 acres of land    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Transcribed Image Text

When a company uses financial leveraging, are the investorsusing their own money?

Other questions asked by students

Basic Math
1.2K views

Find the general solution for differential equation x^3y'''-(3x^2)y''+6xy'-6y=0, y(1)=2, y'(1)=1, y''(1)=-4  

Statistics
1.2K views

In September 2000, each student in a random sample of 100 chemistry majors at a large...

Programming
1.2K views

2.7 Explaining basic networking concepts Basics of network communication Device addresses Basic protocols 2.8 Scenario to install, configure and...

Psychology
1.2K views

What causes an individual resolve the psychosocial crises on each side of trust vs. mistrust and...

Calculus
1.2K views

ind the limit Use l Hospital s Rule where appropriate If there is a more...

Algebra
1.2K views

10 Given the parent function f x x the function g x x 1 2...

Algebra
1.2K views

Solve for y and check the solution:3(2y - 6) + 8y = 12y + 2

Algebra
1.2K views

b b 1 2 b n 2 b n 1 1 for n 2 2...

Accounting
1.2K views

please use the following information to complete the 1040, shedule 1, schedule A, and schedule...

Accounting
1.2K views

Mally receives 16% of eBay sales plus S65 for each tam she lists through her...

Accounting
1.2K views

STARBUCKS CORPORATRR IONCONSOLIDATED STATEMENTS OF EARNINGS(in millions, except per share data)Fiscal Y ear Ended Oct...

Accounting
1.2K views

Task 2: Wonder Worlds produces two types of watches: digital and analog. The company manufactures...