When EBIT Is Positive, Increasing Financial Leverage Increases the Sensitivity

question 82

True/False

When EBIT is positive, increasing financial leverage increases the sensitivity of EPS and ROE to changes in EBIT.

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Definitions:

Chronemics

The study of how time is perceived, structured, and used in various cultures, and its effect on communication.

Haptics

The study of touch and its implications in human interaction and technology, including the design of devices that mimic the sensation of touch.

Body Language

Nonverbal communication through physical behaviors, such as gestures, facial expressions, and posture.

Culture Shock

Describes the feeling of disorientation or uncertainty experienced by someone when they are suddenly subjected to an unfamiliar culture, way of life, or set of attitudes.