Question : It refers to the proportion of debt in overall capital. Which concept is highlighted in the given statement?
Option 1: Financial management
Option 2: Financial planning
Option 3: Financial leverage
Option 4: None of the above
Answer (1)
22nd Jan, 2024
Correct Answer: Financial leverage
Solution : Financial leverage refers to the proportion of debt in overall capital. As the financial leverage increases the cost of funds declined because of increased use of cheaper debt but the financial risk increases.
Hence, option C is correct.
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