Constraints Are

question 32

Multiple Choice

Constraints are

• A)quantities to be maximized in a linear programming model.
• B)quantities to be minimized in a linear programming model.
• C)restrictions that limit the settings of the decision variables.
• D)input variables that can be controlled during optimization.

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Definitions:

Equity Multiplier

A financial leverage ratio that measures the portion of a company's assets that are financed by stockholder's equity.

Degree Of Total Leverage

A measure that quantifies the sensitivity of a company's earnings before interest and taxes to a change in its sales.

Financial Leverage

The use of borrowed capital or debt to increase the potential return of an investment.

Operating Leverage

Operating leverage is a measure of how revenue growth translates into growth in operating income, indicating the extent to which a company can increase its profits by increasing sales.