Which of the Following Statements About Highly Leveraged Companies Is

question 3

Multiple Choice

Which of the following statements about highly leveraged companies is true?

• A)Fixed costs are high and variable costs are low.
• B)Large changes in sales volume result in larger changes in net income.
• C)There is a higher possibility of net income or net loss and, therefore, more risk than in a highly leveraged firm.
• D)All of these answers are correct.

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Definitions:

Involuntary Part-Timers

Workers who are employed less than full-time due to economic reasons, such as a scarcity of full-time positions, rather than by personal choice.

Superordinates

Superordinates are individuals or groups in a higher position of authority or rank in a social hierarchy or structure.

Subordinates

refers to individuals or groups that are lower in rank or position, often having less power or authority compared to others within a social or organizational hierarchy.

Authority

The power or right to give orders, make decisions, and enforce obedience.