The return of equity will increase. Businesses can finance
themselves with debt and equity capital. By aggregating the quantity of debt
capital kin to its equity capital, a company can increase its return on equity.
The way in which rising financial leverage increases ROE is a
little less instinctive. One way to think about it is that if a business
adds debt, its assets increase for the reason that its
cash inflows from the debt issuance and so does its
entire debt.
Answer:
A. Inflation
Explanation:
CPI is an abbreviation for the consumer price index. The CPI is a measure of the average changes in the prices of consumer goods and services in the economy. The CPI index measures changes in prices of products that represent the general consumption in the economy. Economists use the CPI index to ascertain the rate of inflation.
Inflation is described as the increase in prices of goods and services in the economy in a period. If prices in the economy are increasing at a high rate, the CPI index will be high. A high CPI index indicates the inflation rate is high.
The true statements here are:
A. and B.
Explanation:
In a policy that is for medical or in general converge of insurance it is usual business practice to get the percentage of coverage be the total amount of a medical expense that your insurance will pay before your deductible is met.
This means that the amount that is agreeable to pay by the insurance company is paid first and then the amount you put in is used.
With 80/20 plan of insurance, your insurance is deemed to be paying 80% and you pay 20%.
This plan relies on the fact that there is usually no need for the use of that much money from the side of the firm.
