Business Physics: Leverage & Overtrading

A unified pedagogical simulator integrating the animated mechanical lever, profit elasticity, and cash-flow survival limits.

by Kardi Teknomo

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System Forces

Capital Constraints

Loading State...
Net Profit (\(P\))
$0
\((R \cdot g) - F\)
Operating Leverage
0.0
\(\Lambda = \frac{R \cdot g}{P}\)
Critical Leverage Limit
0.0
\(\Lambda_{crit} = \frac{g(K-1)}{Kg-1}\)
Capital-to-Burn Ratio
0.0
\(K = \frac{C_{avail}}{t \cdot F}\)

The Mechanical Fulcrum

The rigid triangle is your Break-Even Point (Fixed Costs). Watch how the lever stabilizes as Revenue moves further from the fulcrum.

The Overtrading Singularity

As Revenue grows, Leverage (\(\Lambda\)) shrinks (moving left to right). Notice when Required Capital exponentially consumes Available Capital.