The use of borrowed funds to increase the return on owner's equity is called
A) financial planning.
B) investment management.
C) management leverage.
D) financial leverage.
E) return on leverage.

Question

Quizplus · Accepted Answer

The use of borrowed funds to increase the return on owner's equity is known as financial leverage. This technique can be risky because it increases the potential for a higher return but also increases the potential for losses.

The Use of Borrowed Funds to Increase the Return on Owner's