Which Statement Is Not Correct About Financial Leverage

question 72

Multiple Choice

Which statement is not correct about financial leverage?

• A)There are many ways to calculate financial leverage.
• B)It represents the relative debt to a company's equity base.
• C)It allows a shareholder to increase their return on equity.
• D)There is only one way to calculate financial leverage.

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Definitions:

External Attributions

The process of attributing the cause of one's own or others' behavior to external factors or situational circumstances.

Individualism

A societal concept that prioritizes individual liberty and autonomy above the interests or management of the group or government.

Dispositional Attributional Bias

The tendency to attribute people's behaviors to their character or personality while underestimating situational influences.

Group Goals

Objectives or outcomes that a group collectively seeks to achieve, which can influence the behavior and cooperation of its members.