If a Small Change in Sales Results in a Large

question 6

True/False

If a small change in sales results in a large change in EPS,then it must be caused by the financial leverage associated with the firm.

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Definitions:

Government Revenue

The money received by a government from taxes, fees, fines, intergovernmental grants, and other sources to fund public services and obligations.

Tax

Mandatory financial charge imposed by a government on individuals, companies, or transactions to fund public expenditures.

Consumer Surplus

The difference between what consumers are willing to pay for a good or service and what they actually pay, indicating economic benefit.

Tax

Compulsory financial charges or other types of levies imposed upon a taxpayer by a governmental organization in order to fund government spending and various public expenditures.