Using borrowed funds to earn a profit higher than the interest charged for borrowing is called

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The term used for using borrowed funds to earn a profit higher than the interest charged for borrowing is called leveraging. By leveraging, an individual or a business can increase their potential return on investment. However, leveraging also involves some risks as the return on investment might be lower than expected, which could result in a negative impact on the borrower's finances.

Using Borrowed Funds to Earn a Profit Higher Than the Interest