Variability in Earning Numbers

question 14

Multiple Choice

Variability in earning numbers:

• A) Is desirable as it increases variance of earnings and hence value of stock options
• B) Increases if a company increases its operating leverage
• C) Increases if a company decreases its financial leverage
• D) Is independent of operating leverage

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Definitions:

Calvin Cycle Reactions

A series of biochemical redox reactions that take place in the stroma of chloroplasts in photosynthetic organisms. It is a critical part of the process of carbon fixation, converting carbon dioxide into glucose.

Stroma

The supportive tissue of an epithelial organ, tumor, gonad, etc., consisting of connective tissues and blood vessels.

ATP Synthase

Complex of proteins in the cristae of mitochondria and thylakoid membrane of chloroplasts that produces ATP from the diffusion of hydrogen ions across a membrane.

Coenzyme

Nonprotein organic molecule that aids the action of the enzyme to which it is loosely bound.