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A hotel would be an example of a company with high operating leverage.
Operating Lease
A lease agreement that allows for the use of an asset but does not convey rights of ownership to the lessee.
Capital Lease
A leasing arrangement that is treated like an asset purchase for accounting purposes, where the lessee records the leased asset as if it has been purchased.
Market Interest Rate
The prevailing rate of interest determined by supply and demand in the money market, influencing the rates borrowers pay and lenders receive.
Contractual Interest Rate
The interest rate stated in a contract or agreement between a borrower and a lender.
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