Multiple Choice
In an EPS-operating income graphical relationship,the slope of the debt line is steeper than the equity line.The debt line has a negative intercept because:
A) the break-even point is higher with debt.
B) a fixed interest charge must be paid even at low earnings.
C) the amount of interest per share has only a positive effect on the intercept.
D) the higher the interest rate,the greater the slope.
Correct Answer:
Verified
Correct Answer:
Verified
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