The Concept of Leverage Is

question 183

Multiple Choice

The concept of leverage is

• A) it is appropriate to borrow if the return on the assets is greater than the cost of the financing.
• B) it is appropriate to borrow as long as the lender approves the loan.
• C) it is unfavorable to borrow funds rather than raise the capital from stockholders.
• D) that a high debt-to-equity ratio is favorable.

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Definitions:

Chaleff's Conception

The theory or idea proposed by Ira Chaleff focusing on the dynamics of followership and the importance of courageous followers.

Proactive

Denotes an approach that involves taking action in anticipation of future problems, needs, or changes rather than reacting to events after they occur.

Effective Follower

An individual who actively supports leaders and contributes to the achievement of goals with competence, commitment, and critical thinking.

Decisions

Conclusions or resolutions reached after consideration.