Here is the mainb question Assume that you were going to explain good and bad uses of leverage to a person just about to buy

Here is the mainb question Assume that you were going to explain good and bad uses of leverage to a person just about to buy a restaurant or other small business or to a home buyer. How would you explain this concept? If they were to finance 90% of the purchase, is that too much leverage? If they bought only what they could buy for cash, are they being too conservative on use of leverage? respond to student 1 below If the business owner is willing to finance 90%  of the purchase I don’t think that is too much leverage depending if the business is foreseeing to make profit and have equity or assets that will be over the debt of 90% plus interest.  I think financing the business is a great idea and there are many ful tools out there for businesses. I don’t think this would work for a restaurant though since there is a lot of competition.

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