The financial leverage multiplier is an indicator of a corporation utilizing
A) total debt.
B) operating leverage.
C) long-term debt.
D) total assets.

Question

Quizplus · Accepted Answer

The financial leverage multiplier measures the impact of debt on a company's financial risk. It is calculated by dividing total debt by total assets. A higher financial leverage multiplier indicates that a company is using more debt to finance its operations, which can increase its financial risk.

The Financial Leverage Multiplier Is an Indicator of a Corporation