The use of personal borrowing to change the overall amount of ﬁnancial leverage to which the individual is exposed is called:
A) Homemade leverage.
B) Dividend recapture.
C) The weighted average cost of capital.
D) Private debt placement.
E) A privileged subscription offer.

Question

Quizplus · Accepted Answer

The use of personal borrowing to change the overall amount of financial leverage to which the individual is exposed is called homemade leverage. This approach allows individuals to increase their exposure to leverage without having to rely solely on external financing.

The Use of Personal Borrowing to Change the Overall Amount