If a Firm Earns 10% Return on Funds They Borrowed

question 192

True/False

If a firm earns 10% return on funds they borrowed at 15% interest, the owners of the firm realize a benefit from using leverage.

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Definitions:

Burger Court

The term refers to the time when Warren E. Burger served as Chief Justice of the United States Supreme Court, from 1969 to 1986, characterized by significant rulings including those on abortion and the death penalty.

Liberals

Individuals or political groups advocating for policies that emphasize individual rights, democracy, and equality, often supporting progressive reforms.

Second Gilded Age

Refers to a period characterized by significant economic growth, wealth concentration, and political influence of businesses, drawing parallels with the original Gilded Age of the late 19th century.