Name the Four Components That When Properly Designed,aligned,and Developed,ensure the Successful

question 42

Essay

Name the four components that when properly designed,aligned,and developed,ensure the successful execution of a business strategy

---

Definitions:

Operating Leverage

The use of fixed as opposed to variable cost in a firm’s cost structure.

Combined Leverage

Refers to the use of both operating and financial leverage by a company to assess the potential impact on earnings due to changes in sales.

Degree of Financial Leverage

A measure that quantifies the sensitivity of a company's earnings per share to fluctuations in its operating income due to the use of fixed cost financing.

Earnings per Share

A company's net profit divided by the number of its common shares outstanding, indicating the company's profitability on a per-share basis.