A Change in EBIT Is Magnified into a Larger Change

question 64

Multiple Choice

A change in EBIT is magnified into a larger change in EPS. This means that financial leverage is using ____ as its fulcrum.

• A) short-term costs
• B) fixed costs
• C) variable costs
• D) retained earnings

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Definitions:

Job Characteristics Model

A framework that suggests jobs can be designed to enhance employee motivation, satisfaction, and performance by addressing core job dimensions.

Job Enrichment

The process of making a job more rewarding, challenging, and interesting by adding more meaningful tasks and duties.

Motivating Potential

A measure of the capacity of a job to provide intrinsic motivation through its characteristics, such as variety and significance.

Job Enlargement

The process of broadening the scope of a job by adding more tasks and responsibilities to improve job satisfaction.