Use the Information for the Question(s)below

question 30

Multiple Choice

Use the information for the question(s) below.
Fly by Night Aviation (FBNA) expects to have net income next year of $24 million and interest expense of $3 million.FBNA's corporate tax rate is 21%.
-IF FBNA increases leverage so that its interest expense rises by $1 million,then the amount its unlevered EBIT will change is closest to:

• A)$0.
• B)-$400,000.
• C)$600,000.
• D)$400,000.

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Definitions:

Closing Phase

The final stage in a process or activity, where completion is prepared and assessed.

Follow Up Questions

Questions asked after an initial question or discussion, aimed at obtaining more detailed information or clarifying previous answers.

Suspense

A state of mental uncertainty or excitement, as in awaiting a decision or outcome, often used to engage audiences in literature or film.

Effective Manager

A manager who achieves organizational goals through efficient planning, organizing, leading, and controlling of resources.