If a Firm Has a Degree of Financial Leverage (DFL)

question 62

True/False

If a firm has a degree of financial leverage (DFL) of 2.0, earnings per share will change 2% for every 1% change in sales volume.

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Definitions:

Anxiolytic Medication

Drugs designed to inhibit anxiety without necessarily affecting mood or arousal; commonly used to treat anxiety disorders.

Meditation

A practice of focused concentration, often for relaxation, stress reduction, and self-improvement.

Somatic Symptom Disorder

A mental health condition characterized by an individual experiencing significant physical symptoms that may not have a diagnosable medical explanation, causing major distress and problems functioning.

Relaxation

Techniques or practices that reduce stress and tension in the body and mind, promoting a state of calm.