Examlex
Which of the following steps in the research process involves calculating statistics?
Financial Risk
The risk added by the use of debt financing. Debt financing increases the variability of earnings before taxes (but after interest); thus, along with business risk, it contributes to the uncertainty of net income and earnings per share. Business risk plus financial risk equals total corporate risk.
Market Risk
The possibility for an investor to experience losses due to factors that affect the overall performance of the financial markets.
Diversifiable Risk
The portion of investment risk that can be reduced or eliminated through diversification among different assets.
Financial Leverage
Utilizing debt to finance additional assets, aiming to increase returns to shareholders but also increasing risk.
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