CFA Practice Question
What is the leverage factor associated with a 40% margin rate?
B. 2.5
C. 40.0
A. 1.4
B. 2.5
C. 40.0
Correct Answer: B
Leverage factor = (total assets / equity) = (100%/40%) = 2.5
User Contributed Comments 4
| User | Comment |
|---|---|
| kalps | Leverage factor = total assets / Equity 100/40 |
| sarath | Leverage factor = 1/margin rate.. |
| irapp92 | @kalps thanks, it's comments like those that really make analystnotes worth it.. |
| khalifa92 | Leverage factor: the multiplier of using leverage on investment. |