Operating Leverage Primarily Affects the __________ While Financial Leverage Primarily

question 62

Multiple Choice

Operating leverage primarily affects the __________ while financial leverage primarily affects the __________.

• A) left-hand side of the balance sheet; the lower part of the income statement
• B) right-hand side of the balance sheet; the upper part of the income statement
• C) the lower part of the income statement; the right-hand part of the balance sheet
• D) the upper part of the income statement; the left-hand side of the balance sheet

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Definitions:

Two-factor Theory

A psychological theory proposed by Herzberg that suggests job satisfaction and dissatisfaction arise from two different sets of factors: motivation and hygiene factors.

Employee Motivation

The amount of enthusiasm, dedication, and innovation employees contribute to their roles in a corporation.

Herzberg

Refers to the two-factor theory by Frederick Herzberg, which posits that certain factors in the workplace result in job satisfaction, while others lead to dissatisfaction, hence differentiating between 'motivators' and 'hygiene factors'.

Taylor's Scientific

Refers to Taylor's Scientific Management Theory, emphasizing efficiency and productivity through the analysis and optimization of workflow.