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- There are three main types of leverage123:
- Operating Leverage: This is a result of operating fixed expenses.
- Financial Leverage: This is created with the help of the debt component in a company’s capital structure.
- Combined Leverage: This is a combination of both operating and financial leverage.
Learn more:✕This summary was generated using AI based on multiple online sources. To view the original source information, use the "Learn more" links.Leverage is of three types: 1. Operating Leverage, 2. Financial Leverage, and 3. Combined Leverage.www.businessmanagementideas.com/financial-ma…Types of Leverage
- Financial Leverage (FL) A Degree of Financial Leverage is created with the help of the debt component in a company’s capital structure. ...
- Operating Leverage (OL) Just like the financial, it is a result of operating fixed expenses. ...
efinancemanagement.com/financial-leverage/lever…Key takeaways
- Leverage refers to the use of borrowed capital to amplify potential returns or losses on an investment, and it comes with advantages and risks.
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