Leverage results from the use of fixed-cost assets or funds to magnify returns to the firm's owners.

Name: Leverage results from the use of fixed-cost assets or funds to magnify returns to the firm's owners.
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Question

Quizplus · Accepted Answer

Leverage refers to the use of fixed-cost assets or funds to magnify returns to the firm's owners. This can result in increased profitability and can benefit the firm's owners. However, it also comes with increased risks as any losses would also be magnified.

Leverage Results from the Use of Fixed-Cost Assets or Funds