Finance

Finance Chapter 13 1. Operating leverage is change in gross revenue (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 locomote see an EBIT increase and sales. The negative aspect is if the unit sales drop EBIT will decrease by a move greater than sales. 2. Yes, the total story of business risk that a company faces is a function of both sales and the leg of operating cost. 3. Financial leverage is the additional volatility of pull ahead 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 ceaselessly a percentage of business risk involved. 4. I study the majority of your local mom& pop stores, in the main smaller stores with limited customer. 5. Major corporations such as nutrient social lion and Sear Roebuck. 6. Publicly owned corporations that has been brought bulge by in...If you destiny to get a full essay, bon ton it on our website: OrderEssay.net

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