Explain Why Using Leverage to Purchase Risky Securities Is So

question 35

Essay

Explain why using leverage to purchase risky securities is so popular.

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Definitions:

Monthly Cash Expenses

The total amount of cash payments made by a business within a month to cover its operational expenses and obligations.

Cash On Hand

The total amount of cash or cash equivalents that a business or individual has accessible immediately.

Cash Equivalents

Short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

Illegal States

In computing, it refers to conditions or configurations of a system or application that are not permitted or that violate pre-defined rules.