Financial Leverage Amplifies Relative Changes in EBIT into Larger Relative

question 190

Multiple Choice

Financial leverage amplifies relative changes in EBIT into larger relative changes in ROE and EPS, operating leverage amplifies:

• A)relative changes in EBIT into larger relative changes in sales revenue.
• B)relative changes in sales revenue into larger relative changes in EBIT.
• C)relative changes in sales revenue into larger relative changes in ROE and EPS.
• D)relative changes in ROE and EPS into larger relative changes in EBIT.

---

Definitions:

Asymmetrical

Describing a shape or distribution that does not mirror evenly across a central axis.

Peaked

Describes a distribution that has a sharper or higher peak compared to a normal distribution.

Grouped Frequency Distribution

A method in statistics for organizing data into intervals or groups to display the frequencies of observations within each group.

Intervals

Segments between two points on the number line, often used to specify ranges of values for variables or data.