In the Fifth Year of Operations Both Sea Ltd

question 17

Multiple Choice

In the fifth year of operations both Sea Ltd. and Air Inc. had EBIT of $6 million. At the end of the year, the degree of financial leverage for Sea had decreased by 10% and for Air by 50%. What conclusion can be drawn from this?

• A) EBIT grew more quickly at Sea than at Air.
• B) Air has relatively more capital payments than Sea.
• C) EPS decreased more rapidly at Sea.
• D) EBIT did not change by much at Air.
• E) EPS remained at 90% of EBIt at Sea.

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Definitions:

Protocells

Simple, self-organized, prebiotic structures that are considered the precursors to living cells.

Eukaryotic Cells

Cells that contain a nucleus and other organelles enclosed within membranes, differentiating them from prokaryotic cells.

Prokaryotic Cells

Simple, single-celled organisms without a nucleus or other membrane-bound organelles, such as bacteria.

Invertebrates

Animals that lack a vertebral column or backbone, including groups such as insects, mollusks, and arachnids.