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Improving Hundreds of Thousands of Routine "Small" Decisions Can Add

question 52

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Improving hundreds of thousands of routine "small" decisions can add up to a large annual value for a business firm.


Definitions:

Capital Structure

The composition of a company’s debt and equity used to finance its overall operations and growth.

Market Risk Premium

The additional return an investor requires from a market portfolio over the risk-free rate, compensating for the risk of the investment.

Financial Leverage

The use of borrowed funds to increase the potential return on an investment.

Shareholder Leverage

The use of borrowed funds by shareholders to increase their potential returns from an investment.

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