Finance

Finance Chapter 13 1. Operating leverage is change in gross sales (small), which triggers a change in operating income. They be caused by fixed cost in the operation firm. A firm with a high operating leverage lapse see an EBIT increase and sales. The negative aspect is if the unit sales drop EBIT will decrease by a leave of absence greater than sales. 2. Yes, the total story of business risk that a company faces is a function of both sales and the gradation of operating cost. 3. Financial leverage is the additional volatility of unaccented up income caused by presence of fixed cost capital in the firms capital structure. Financial leverage post be volatility of the NI if the income changes.

There is ever so a percentage of business risk involved. 4. I debate the majority of your local mom& pop stores, chiefly smaller stores with limited customer. 5. Major corporations such as diet social lion and Sear Roebuck. 6. Publicly owned corporations that has been brought turn out by in...If you destiny to get a full essay, ordination it on our website: OrderEssay.net

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