The overall financial risk depends upon

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Target Exam

CUET

Subject

Business Studies

Chapter

Financial Management

Question:

The overall financial risk depends upon which of the following?

Options:

Proportion of debt in the total capital

Proportion of equity in the total capital

Both of the above

None of the above

Correct Answer:

Proportion of debt in the total capital

Explanation:

There is some amount of financial risk in debt financing. The overall financial risk depends upon the proportion of debt in the total capital.