Financial leverage is also known as.
A. Trading on equity
B. Trading on debt
C. Interest on equity
D. Interest on debt
Answer: Option A
Solution(By Examveda Team)
Financial leverage is also known as Trading on equity. It is the balance between the cost financing operations with equity or debt and the income earned from the operations. In other words, it's a gamble.Join The Discussion
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Investment is the _______________.
A. net additions made to the nation’s capital stocks
B. person’s commitment to buy a flat or house
C. employment of funds on assets to earn returns
D. employment of funds on goods and services that are used in production process
Financial Management is mainly concerned with ______________.
A. All aspects of acquiring and utilizing financial resources for firms activities
B. Arrangement of funds
C. Efficient Management of every business
D. Profit maximization
The primary goal of the financial management is ____________.
A. to maximize the return
B. to minimize the risk
C. to maximize the wealth of owners
D. to maximize profit
In his traditional role the finance manager is responsible for ___________.
A. proper utilisation of funds
B. arrangement of financial resources
C. acquiring capital assets of the organization
D. efficient management of capital
The correct answer is trading on debt. Financial levarage is proportion debt in capital structure. Firm is said to be levered if its capital structure contains debt.