An EPS-Operating Income Graph, Such as Figure 17

Multiple Choice

An EPS-operating income graph, such as Figure 17.1, shows the

A) greater risk associated with debt financing, which is evidenced by a greater slope.
B) the break-even point where EPS of two different debt ratios are equal.
C) the minimum operating income needed to pay the interest for a given level of debt.
D) greater risk associated with debt financing, which is evidenced by a greater slope, the break-even point where EPS of two different debt ratios are equal, and the minimum operating income needed to pay the interest for a given level of debt.