Below the Break-Even EBIT, Increased fiNancial Leverage Will _______ EPS

question 54

Multiple Choice

Below the break-even EBIT, increased financial leverage will _______ EPS, all else the same. Assume there are no taxes.

• A) Increase.
• B) Decrease.
• C) Not affect.
• D) Either increase or decrease.
• E) Increase EBIT but decrease.

---

Definitions:

Whaling Industry

The practice of hunting whales for their usable products like meat, oil, and blubber, which has historically played a significant economic role in some cultures.

Whale Meat

The flesh of whales used as food, which is a controversial subject due to conservation efforts.

Japan

An island country in East Asia known for its rich history, diverse culture, and advanced technology.

Lake Nipissing

A freshwater lake located in Ontario, Canada, known for its recreational fishing and role in local ecosystems.