Expert Analysts Resources (EAR) Has Provided You with the Following

question 47

Multiple Choice

Expert Analysts Resources (EAR) has provided you with the following information about three companies you are currently evaluating:
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C $\begin{array} { l c c } \text { Company } & \text { Degree of Operating Leverage (DOL) } & \text { Degree of Financial Leverage (DFL) } \\\hline\text { Acme } & 1.5 \times & 6.0 \times \\\text { Apex } & 3.0 \times & 4.0 \times \\\text { Alps } & 5.0 \times & 2.0 \times\end{array}$
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Based on this information, which firm is regarded as having the greatest overall risk?

• A)Acme, because it has the highest degree of financial leverage (DFL).
• B)Acme, because has the highest degree of total leverage (DTL).
• C)Apex, because it has the highest degree of total leverage (DTL).
• D)Alps, because it has the highest degree of operating leverage (DOL).
• E)Acme, because it has the lowest degree of operating leverage (DOL).

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The ability of an organism to resist harmful microorganisms from entering it, or the protection granted by law to certain officials or entities from legal action or prosecution.

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The ability of a consumer or a group of consumers to buy goods and services with their income at given prices.

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