Degree of combined leverage is the fraction of:

CS Executive · Financial and Strategic Management · PYQS · June 2021
Degree of combined leverage is the fraction of:
(A) Percentage change in EBIT on Percentage change in Sales
(B) Percentage change in EPS on Percentage change in Sales
(C) Percentage change in Sales on Percentage change in EPS
(D) Percentage change in EPS on Percentage change in EBIT

Answer & Explanation:

Correct Answer: Option (B)

Official answer key: (B).

Topics: Capital Structure

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