A High Degree of Financial Leverage Means That a Small

question 134

Multiple Choice

A high degree of financial leverage means that a small change in sales will result in:

• A) a small change in earnings per share
• B) a large change in earnings per share
• C) no change in earnings per share
• D) always a negative change in earnings per share

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Definitions:

Expected Frequencies

The theoretical frequencies predicted in statistical hypothesis testing based on the assumptions of the null hypothesis.

Null Hypothesis

The proposition that assumes no significant difference or relationship exists within a set of data.

Groups

Collections of subjects or data points that are often categorized for comparative analysis in experiments or studies.

Null Hypothesis

A statement that asserts there is no effect or no difference, typically the default assumption in a statistical test.