Management should tailor the use of leverage to meet its own risk-taking desires.

Name: Management should tailor the use of leverage to meet its own risk-taking desires.
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Question

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Management should assess and evaluate the risks associated with using leverage and determine the level of risk they are willing to undertake. They can use leverage to increase returns, but they must also be aware of the potential downside and manage the risks accordingly to meet their own risk-taking desires.

Management Should Tailor the Use of Leverage to Meet Its