EBITDA Is More Sensitive to Changes in Revenue Than EBIT

question 91

True/False

EBITDA is more sensitive to changes in revenue than EBIT.

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Definitions:

Compensating Balance

A minimum cash balance required by some banks to be maintained in a bank account.

Maximum Cash Balance

The highest amount of cash that a company aims to hold at any given time.

Internal Control

Protocols and processes designed by a business to secure the authenticity of its financial and accounting information, enhance accountability, and impede fraudulent operations.

Control Environment

The set of standards, processes, and structures that provide the foundation for carrying out internal control across the organization.