A Degree of Operating Leverage of 1

question 68

Multiple Choice

A degree of operating leverage of 1.5 times indicates that _____.

• A) for every 1 percent change in EPS there will be a 1.5 percent change in sales
• B) for every 1 percent change in interest there will be a 1.5 percent change in EBIT
• C) for every 1 percent change in sales there will be a 1.5 percent change in EBIT
• D) for every 1 percent change in EBIT there will be a 1.5 percent change in EPS
• E) for every 1 percent change in sales there will be a 1.5 percent change in EPS

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