If the Business Cycle Were Just Beginning Its Upswing, Which

question 7

Multiple Choice

If the business cycle were just beginning its upswing, which firm would you anticipate would be likely to show the best growth in EPS over the next year? Firm A has high combined leverage and Firm B has low combined leverage.

• A) Firm A
• B) Firm B
• C) Indifferent between the two
• D) It depends on how much financial leverage each firm has.

---

Definitions:

United States

A country located primarily in North America consisting of 50 states and is a federal republic.

Parental Sensitivity

The ability of a parent to perceive and interpret accurately the needs, desires, and signals of their child and to respond appropriately.

Difficult Family Conditions

Situations or environments within families that pose challenges to its members, often affecting their emotional, physical, and mental well-being.

Unpredictable Caregiving

Variability and inconsistency in caregiving responses, which can affect attachment and development in children.