A Firm Increases Its Financial Leverage When Its ROA Is

Multiple Choice

A firm increases its financial leverage when its ROA is greater than the cost of debt.Everything else equal this change will probably increase the firm's _______.
I.beta
II.earnings variability over the business cycle
III.ROE
IV.stock price

A) I and II only
B) III and IV only
C) I, III and IV only
D) I, II and III only