The correct answer is Debt Capital. Financial LeverageIt is the use of debt to buy more assets. It is employed to increase the return on equity. The financial leverage formula is measured as the ratio of total debt to total assets. Debt CapitalDebt Capital refers to borrowed funds that must be repaid at a later date. This is any form of growth capital a company raises by taking out loans. These loans may be long-term or short-term such as overdraft protection. Debt capital does not dilute the company owner's interest in the firm. Additional InformationEquity CapitalEquity capital typically comes from funds invested by shareholders. An equity fund doesn't require a business to take out debt which means it doesn't need to be repaid. Equity capital is reported on the stockholder's equity section of a company's balance sheet. Long-term loansIt generally refers to a company's loans and other liabilities that will not become due within one year of the balance sheet date. They are a key component of business solvency ratios which are analyzed by stakeholders and rating agencies when assessing solvency risk. Short-term loansIt is a type of loan that is obtained to support a temporary personal or business capital. As it is a type of credit, it involves repaying the principal amount with interest by a given due date, which is usually within a year from getting the loan.