leverage

leverage
The ability to finance an investment with a small amount of one's own funds, such as a down payment, with the balance consisting of borrowed funds. The use of a smaller investment to generate a larger rate of return through borrowing. The amount of money borrowed by party in business in excess of money or assets invested personally in the business. Community Bank v. Jones, 278 Or. 647, 566 P.2d 470, 475.
Term refers to the advantages that may accrue to a business through the use of debt obtained from third persons (e.g. banks or outside investors) in lieu of contributed capital. Such debt improves the earnings allocable to contributed capital if the business earns more on each dollar invested than the interest cost of borrowing funds. The effect on common stockholders of the requirements to pay bond interest and preferred stock dividends before payment of common stock dividends

Black's law dictionary. . 1990.

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Synonyms:
(obtained by the lever)


Look at other dictionaries:

  • leverage — le·ver·age 1 / le vrij, və rij/ n: the use of credit to enhance one s speculative capacity leverage 2 vt aged, ag·ing: to provide (as a corporation) or supplement (as money) with leverage Merriam Webster’s Dictionary of Law. Merriam Webster. 1996 …   Law dictionary

  • Leverage — Título Leverage(Estados Unidos) Las Reglas del Juego(España) Género Drama Creado por John Rogers Chris Downey Reparto Timothy Hutton …   Wikipedia Español

  • Leverage — (engl. für Hebelwirkung) bezeichnet: Leverage Effekt, einen Begriff der Finanzwirtschaft Leverage (Band), eine finnische Rockband Leverage (Fernsehserie), eine US amerikanische Fernsehserie Diese Seite ist eine …   Deutsch Wikipedia

  • Leverage — Lev er*age (l[e^]v [ e]r*[asl]j or l[=e] v[ e]r*[asl]j), n. The action of a lever; mechanical advantage gained by the lever. [1913 Webster] {Leverage of a couple} (Mech.), the perpendicular distance between the lines of action of two forces which …   The Collaborative International Dictionary of English

  • leverage — /ˈlivəredʒ, ingl. ˈliːvərɪdʒ/ [ingl. leverage propr. «azione di una leva, leveraggio»] s. m. inv. (econ.) leva finanziaria …   Sinonimi e Contrari. Terza edizione

  • leverage — ► NOUN 1) the exertion of force by means of a lever. 2) the power to influence: political leverage …   English terms dictionary

  • leverage — (n.) 1724, action of a lever, from LEVER (Cf. lever) (n.) + AGE (Cf. age). Meaning power or force of a lever is from 1827; figurative sense from 1858. The financial sense is attested by 1933, Amer.Eng.; as a verb by 1956. Related: Leveraged;… …   Etymology dictionary

  • leverage — The first syllable is pronounced leev in BrE and lev in AmE …   Modern English usage

  • leverage — [n] influence advantage, ascendancy, authority, bargaining chip*, break, clout, drag, edge, grease*, jump on*, power, pull, rank, ropes*, suction, weight; concepts 687,693 …   New thesaurus

  • leverage — [lev′ərij, lē′vərij] n. 1. the action of a lever 2. the increased force resulting from this 3. means of accomplishing some purpose vt. leveraged, leveraging to speculate in (a business investment) largely through the use of borrowed funds, or… …   English World dictionary

  • leverage — The ability to control large dollar amounts of a commodity with a comparatively small amount of capital. Chicago Board of Trade glossary The control of a larger sum of money with a smaller amount. By accepting the liability to purchase or deliver …   Financial and business terms

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