Which of the Following Mathematical Expressions Is Used to Calculate

question 65

Multiple Choice

Which of the following mathematical expressions is used to calculate the degree of pretax cash flow operating leverage?

• A) 1 + (FC / EBITDA)
• B) 1 + (FC / EBIT)
• C) 1 + [(FC + Depreciation and Amortization) / EBITDA]
• D) 1 + [(FC + Depreciation and Amortization) / EBIT]

---

Definitions:

Equal Proportion

A division or allocation in the same or identical fractions, percentages, or portions.

Market Risk

The risk of losses in investments due to factors that affect the overall performance of the financial markets.

Coefficient of Variation

A statistical measure of the dispersion of data points in a data series around the mean, indicating the level of volatility.

Probability Distribution

A statistical analysis function that maps out all prospective values and their probabilities for a random variable within an established scope.