The use of borrowing by an individual to adjust his or her overall exposure to financial leverage is referred to as:
A)M&M Proposition I.
B)capital restructuring.
C)homemade leverage.
D)M&M Proposition II.
E)financial risk management.

Question

Quizplus · Accepted Answer

Homemade leverage refers to the use of personal borrowing by an individual to adjust their own financial leverage, effectively replicating the effects of corporate leverage on their personal portfolio.

The Use of Borrowing by an Individual to Adjust His