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

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Finance

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

Answer & Explanation Solved by verified expert
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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
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When a company uses financial leveraging, are the investorsusing their own money?

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