Multiple Choice
Which of the following statements about operating leverage is true?
A) Operating leverage reduces a firm's risk.
B) Operating leverage is the responsiveness of the firm's EBIT to fluctuations in sales.
C) Operating leverage involves the usage of fixed cost financial securities in the operation of a business.
D) Operating leverage is the responsiveness of the firm's EPS to fluctuations in sales.
Correct Answer:
Verified
Correct Answer:
Verified
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