Abstract
This paper is based on the idea that Finance can be made more relevant to students by applying lessons learned in Corporate Finance to the Personal Finance of students. To demonstrate this, the paper introduces a unique example of Operating Leverage and Financial Leverage; and provides examples in which these Corporate Finance concepts are applied to the Personal Finance of students. The basic premise of this paper is that students learn better if the abstract concepts are made relevant to them, i.e., if the instructor relates the abstract concepts to the personal experience of students. This paper implies that there is a good deal of overlap and synergy between Corporate Finance and Personal Finance, and therefore, they should not be dichotomized.
Recommended Citation
(2025)
"Making Finance Relevant by Applying Corporate Finance to Personal Finance: The Case of Leverage,"
Journal of Economics and Finance Education: Vol. 24:
Iss.
1, Article 9.
Available at:
https://scholarship.rollins.edu/jefe/vol24/iss1/9
