A leverage value is considered to be large if it is substantially greater than
A).5 times the average leverage value
B)1.5 times the average leverage value
C)2.0 times the average leverage value
D)5.0 times the average leverage value
E)4.0 times the average leverage value

Question

Quizplus · Accepted Answer

A leverage value is considered to be large if it is substantially greater than the average leverage value. The term "substantially greater" is subjective, but a value 2.0 times the average value is a reasonable threshold for considering it significantly larger. Option A is too low, option B is also a possibility but not as reasonable as option C. Option D and E are too high to be considered in most cases.

A Leverage Value Is Considered to Be Large If It