Which of the Following Is True About the Concept of Leverage

question 5

Multiple Choice

Which of the following is true about the concept of leverage?

• A) at the break-even point, operating leverage is equal to zero.
• B) combined leverage measures the impact of operating and financial leverage on EBIT.
• C) financial leverage measures the impact of fixed costs on earnings.
• D) combined leverage measures the impact of operating and financial leverage on EPS.

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