Which of the Following Statements Is CORRECT?As a Firm Increases

question 12

Multiple Choice

Which of the following statements is CORRECT?As a firm increases the operating leverage used to produce a given quantity of output, this will

• A) normally lead to a decrease in its business risk.
• B) normally lead to a decrease in the standard deviation of its expected ebit.
• C) normally lead to a decrease in the variability of its expected eps.
• D) normally lead to a reduction in its fixed assets turnover ratio.
• E) normally lead to an increase in its fixed assets turnover ratio.

---

Definitions:

Instrumental Functions

The practical and task-oriented activities or roles performed by an individual or within an entity, aimed at achieving specific objectives.

Conflict Perspective

A sociological approach that views social and economic institutions as tools of the struggle between groups or classes, used to maintain inequality and the dominance of the ruling class.

Structural-functionalism

An approach within sociology that considers society to be a complicated system with various parts working in harmony to ensure stability and cohesion.

African Americans

Individuals in the United States with ancestry from the black racial groups of Africa.