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Assume That a Firm Currently Has EBIT of $2,000,000,a Degree

Question 22

Multiple Choice

Assume that a firm currently has EBIT of $2,000,000,a degree of total leverage of 6.000,and a degree of financial leverage of 1.875.If sales decline by 20% next year,then what will be the firm's expected EBIT in one year?


A) $619,200
B) $720,000
C) $871,200
D) $763,200
E) $813,600

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