A Degree of Operating Leverage (DOL) Equal to 1

question 33

Multiple Choice

A degree of operating leverage (DOL) equal to 1.5 times indicates that for every 1 percent change in _____. 

• A)earnings per share (EPS) there will be a 1.5 percent change in sales
• B)interest there will be a 1.5 percent change in earnings before interest and taxes (EBIT)
• C)sales there will be a 1.5 percent change in earnings before interest and taxes (EBIT)
• D)earnings before interest and taxes (EBIT) there will be a 1.5 percent change in earnings per share (EPS)
• E)sales there will be a 1.5 percent change in earnings per share (EPS)

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Definitions:

Notary

A public officer authorized to witness the signing of documents and to administer oaths, ensuring the authenticity of the signatures.

Acknowledgment

The official recognition by a notary public that another’s signature was made by that party’s free will. The acknowledgment is accomplished when the notary has signed the document and added the official seal to it.

Cyber-Agreement

A contract or agreement formed and existing in a digital format, often executed online.

Uniform Commercial Code

A comprehensive set of laws governing all commercial transactions in the United States, intended to standardize and simplify the laws across the states.