________ Is the Potential Use of Fixed Costs, Both Operating

question 28

Multiple Choice

________ is the potential use of fixed costs, both operating and financial, to magnify the effect of changes in sales on the firm's earnings per share.

• A) Debt service
• B) Total leverage
• C) Operating leverage
• D) Financial leverage

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Definitions:

Positive Reinforcement

A technique used in behavioral psychology to increase the likelihood of a desired behavior by rewarding it.

Stimulus Discrimination

The learned ability to differentiate between similar stimuli and respond appropriately to each.

Stimulus Generalization

The process by which a response that has been learned to one stimulus is elicited by a different, but similar, stimulus.

Spontaneous Recovery

The reappearance of a previously extinguished conditioned response after a period of rest, without any further conditioning.