Highly leveraged companies have low fixed costs and high variable costs.

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Highly leveraged companies typically have high fixed costs and low variable costs, as they use debt to finance their operations and therefore have fixed interest payments to make regardless of their level of production or sales. This means that their profitability is highly dependent on their ability to generate enough revenue to cover these fixed costs, which can create added risk for the company and its investors.

Highly Leveraged Companies Have Low Fixed Costs and High Variable