Finance Formulas / July 18, 2018 / Cecelia Weiss
This ratio measures the financial leverage of a company. Companies with higher levels of liabilities compared with assets are considered highly leveraged and more risky for lenders.
When the cross elasticity of demand for product A relative to a change in the price of product B is positive, it means that in response to an increase in the price of product B, the quantity demanded of product A has increased. An increase in the price of product B means that more people will consume A instead of B, and this will increase the quantity demanded of product A.
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