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Personal Finance Problem P13-13 Financial leverage Max Small has outstanding school loans that require a monthly payment of $1,000. He needs to buy a new
Personal Finance Problem P13-13 Financial leverage Max Small has outstanding school loans that require a monthly payment of $1,000. He needs to buy a new car for work and estimates that this pur- chase will add $350 per month to his existing monthly obligations. Max will have $3,000 available after meeting all his monthly living (operating) expenses. This amount could vary by plus or minus 10%. a. To assess the potential impact of the additional borrowing on his financial lever- age, calculate the DFL in tabular form for both the current and proposed loan payments, using Max's available $3,000 as a base and a 10% change. a
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