Harry owns a successful​ company, which he is looking to grow and expand. Instead of using his own money to expand the​ company, he has decided to invest his excess capital in various stocks and other small investments and borrow money to aid in company growth. By doing​ this, Harry believes he will obtain a large rate of return that will help him further expand his company.​ Harry's approach exemplifies which of the​ following?

Harry owns a successful​ company, which he is looking to grow and expand. Instead of using his own money to expand the​ company, he has decided to invest his excess capital in various stocks and other small investments and borrow money to aid in company growth. By doing​ this, Harry believes he will obtain a large rate of return that will help him further expand his company.​ Harry's approach exemplifies which of the​ following?

Harry owns a successful​ company, which he is looking to grow and expand. Instead of using his own money to expand the​ company, he has decided to invest his excess capital in various stocks and other small investments and borrow money to aid in company growth. By doing​ this, Harry believes he will obtain a large rate of return that will help him further expand his company.​ Harry's approach exemplifies which of the​ following?



A. Leverage

B. Debenture

C. Compensating balance

D. Collateral

E. Trade credit



Answer: A. Leverage


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