Define leverage as it is used in finance

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Reference no: EM13927385

1. Define leverage as it is used in finance.

2. Define and give examples of the following:

a. Fixed costs

b. Variable costs

3. Define the following:

a. Operating leverage

b. Financial leverage

4. How is a firm's degree of combined leverage (DCL) related to its degrees of operating and financial leverage?

5. Is it possible for a firm to have a high degree of operating leverage and a low level of business risk? Explain.

6. Is it possible for a firm to have a high degree of combined leverage and a low level of total risk? Explain.

Reference no: EM13927385

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