Question: Discuss why it is difficult to recommend a specific level for the leverage ratio (debt path) as it is related to the return on sales

Discuss why it is difficult to recommend a specific level for the leverage ratio (debt path)

as it is related to the return on sales ratio (ROS) (operating path), asset turnover (asset efficiency path), and the return on investment ratio (ROI). If the amount of debt used in the firm increases, how will ROE be impacted?

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