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Explain why some firms have very little if any financial leverage while other firms have a...

Explain why some firms have very little if any financial leverage while other firms have a significant amount of financial leverage. How will the amount of financial leverage affect decisions by management regarding the health and well- being of the firm?                 

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financial leverage is use of debt or borrowed money to run the business.Firms need to keep a check on it as high amount of leverage which mean high amount of debt to assets ratio. so there is a fixed obligation on firm to pay interest. So if sales are effected there will be effect on the company ability to pay interest. If the firm fails to pay it there will be loss of credibility which will effect the firm future borrowing. So first we have to asses business risk before going to high financial leverage so firms which have high business risk will go for low financial leverage if they do the opposite the financial health of firm will be effected

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