What Is Financial Leverage?
Leverage means the assets you control are bigger than your own money; a lever works in both directions.
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1.What is financial leverage?
Leverage means the assets you control are bigger than your own money; a lever works in both directions.
2.Own money is called what, and borrowed money?
Divide the assets by your own money: 100,000 over 50,000 is 2, a leverage of two.
3.Without interest, the price of both flats rises 10 percent. What is Marge's gain on her own 50,000?
Marge gains 10,000 on her flat of 100,000; Leo gains 5,000, which is 10 percent.
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Sources (2)
- Leverage (finance) (Wikipedia, englisch)
- Eigene Rechnung: synthetisches Hebelbeispiel (Wohnung 50.000 / 100.000, Kredit 4 %)
Education only. Not financial advice.