Words / G / Law

gearing

/ˈɡɪərɪŋ/

B2CEFR level
55/100Rarity: uncommon
TechnicalRegister

Law noun

The ratio of a company's borrowed money to its own equity.

High gearing left the company dangerously exposed when interest rates rose.

Similar: leverage

Topic: Legislation in Legal English

Business noun

The proportion of a company's capital that is financed by debt relative to equity.

High gearing magnified both the group's profits and its exposure to rising interest rates.

Similar: leverage

Topic: Accounting in Business English

Rarity runs from 0 (a word everyone knows) to 100 (almost never seen outside specialist or literary writing). Level is the word's real difficulty on the CEFR scale, from A1 to C2.

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More law words: Legislation