The Degree of Financial Leverage Measures the Sensitivity of Earnings

question 6

True/False

The degree of financial leverage measures the sensitivity of earnings per share to sales.

---

Definitions:

Typology

A systematic classification or study of types that shares common characteristics.

Assessment

Process of gathering information about a person’s symptoms and their possible causes.

Reliability

The consistency of a measure or test; its ability to produce the same results under similar conditions.

Generalizability

The extent to which the findings of a study or experiment can be applied to larger populations or different contexts beyond the original subjects or conditions studied.