Which of the following is a reason for not increasing a business's financial leverage?
A) It can have a positive impact on the business's return on equity.
B) The business can be grown with someone else's money.
C) The interest on debt has a deductible nature.
D) It may lead to an inability to pay the interest on the debt.
E) It decreases a business's overall risk.

Question

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The Answer of Which of the following is a reason for not increasing a business's financial leverage?
A) It can have a positive impact on the business's return on equity.
B) The business can be grown with someone else's money.
C) The interest on debt has a deductible nature.
D) It may lead to an inability to pay the interest on the debt.
E) It decreases a business's overall risk.

Which of the Following Is a Reason for Not Increasing