If Sales Are Expected to Increase 25%,EBIT Is Expected to Increase

question 18

Multiple Choice

If sales are expected to increase 25%,EBIT is expected to increase 15%,and EPS is expected to increase 10%,what is the degree of operating leverage?

• A) 2.5
• B) 6.0
• C) 1.5
• D) 0.6
• E) 1.7

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Definitions:

Entrepreneurial Marketing

A set of processes adopted by entrepreneurs based on new and unconventional marketing practices in order to gain traction in competitive markets.

Traditional Marketing

Marketing practices that use traditional channels such as print ads, billboards, television, and radio to communicate with the target audience.

4 Ps

A marketing model that identifies and optimizes the four key components of marketing strategies: Product, Price, Place, and Promotion.

Business Exists

The state or condition of being actively engaged in a trade or enterprise, often marked by the pursuit of profit.