Glossary

Financial leverage, also known as the equity multiplier, refers to the use of debt to buy assets. If all the assets are financed by equity, the multiplier is 1. As debt increases, the multiplier increases from 1, demonstrating the leverage impact of the debt and, ultimately, increasing the business risk.

Sourcer: https://online.hbs.edu/Documents/managers-guide-to-finance-and-accounting.pdf