The proportion of debt in the overall capital is called financial leverage. Identify the concept
(a) Capital structure (b) Financial leverage
(c) Return on investment (d) Trading on equity
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a) Capital structure
the proportion of debt in the overall capital of a firm is called Financial Leverage or Capital Gearing. When overall debt in the firm increases, cost of funds declines as debt is a cheaper source of funds.
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a) Capital structure
Explanation:
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