A 10% Increase in Sales Causes EPS to Rise from $0.50

question 110

Multiple Choice

A 10% increase in sales causes EPS to rise from $0.50 to $0.56.Assuming the firm has no debt,what is its degree of operating leverage (DOL) ?

• A) 1.00
• B) 1.20
• C) 0.83
• D) 1.50
• E) 0.75