One Way of Measuring the Advantage of Financial Leverage to the Owners

question 90

Multiple Choice

One way of measuring the advantage of financial leverage to the owners of the company is ________.

• A)to examine the earnings per share (EPS)of a company before borrowing from debt lenders
• B)to examine the earnings per share (EPS)of a company after borrowing from debt lenders
• C)to examine the dividends per share (DPS)of a company before and after borrowing from debt lenders
• D)to examine the earnings per share (EPS)of a company before and after borrowing from debt lenders

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Definitions:

Simplify

To reduce a complex subject or issue to its most basic components or form.

Evaluate

To assess or determine the value, quality, importance, or effectiveness of something.

Evaluate

To assess or determine the value, significance, or worth of something through analysis or examination.

Simplify

The process of making an expression, equation, or fraction as straightforward as possible by reducing it to its basic form.