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:

Amygdala

A region of the brain within the temporal lobe, involved in the processing of emotions such as fear, pleasure, and anger.

Perceptual Processes

The sequence of steps that starts with the senses and ends with the perception, or cognitive recognition, of the world around you.

Negative Emotions

Feelings that are generally considered unpleasant or undesirable, like sadness, anger, fear, or jealousy, which may influence behavior and decision-making.

Cognition

The mental action or process of acquiring knowledge and understanding through thought, experience, and the senses, encompassing processes such as memory, judgment, and problem-solving.