It seems like Schweser often generically refers to leverage (e.g., if xyz happens leverage will increase or decrease?) What ratio are they referring to specifically? I’d think the real exam would say a particular ratio.
They use it to mean: Assets/ Equity And yeah, it’s not very clear from that term what they are referring to. T/G
i’d think assets/equity
I always think of it as D/E if I just see leverage. I am always like 10 th person in the thread even if I see a thread righ away.
Assets / Equity if they talk about financial leverage ----------> cues from DuPont
i do remember an answer referring to a/e now that i think about it.
Its kind of a generic term. Leverage could be D/E, D/A, Debt to Cap, Debt/Anything Assets/Equity is used in Dupont, but I don’t see that many other places.
When I see leverage I just think DEBT
I think of see saws
i’m pretty sure they mean leverage from the Dupont Model = Assets/Equity
they are referring to assets/equity but most normal humans think of leverage as debt to equity. it will be clear on the test what they are looking for.