Corporate Finance
Corporate Finance
3rd Edition
ISBN: 9780132992473
Author: Jonathan Berk, Peter DeMarzo
Publisher: Prentice Hall
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Chapter 18.4, Problem 1CC
Summary Introduction

To discuss: The important steps involved in the flow to equity process for valuing a levered investment.

Introduction:

Leverage can refer to the amount of debt used to finance assets. Leverage uses borrowed funds or various financial instruments to increase the returns on the investment. If a company has high leverage, it means that the instrument has more debt than equity.

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