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    Practical Financial Management Study Set 1
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    Exam 14: Capital Structure and Leverage
  5. Question
    The Underlying Reason That Financial Leverage Contributes to Shareholder Wealth
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The Underlying Reason That Financial Leverage Contributes to Shareholder Wealth

Question 174

Question 174

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The underlying reason that financial leverage contributes to shareholder wealth is that under certain conditions it improves financial performance as measured by EBIT, ROE, and EPS.

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