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What is the main risk associated with financial leverage?
  • a)
    Interest Rate Risk
  • b)
    Liquidity Risk
  • c)
    Business Risk
  • d)
    Financial Risk
Correct answer is option 'D'. Can you explain this answer?
Most Upvoted Answer
What is the main risk associated with financial leverage?a)Interest Ra...
Financial leverage is primarily associated with financial risk. Financial risk arises when a company uses debt financing to a significant extent, and it involves the variability in returns associated with the use of debt. This risk can result from changes in interest rates and the company's ability to meet its debt obligations.
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